AMSC (NASDAQ:AMSC), a global solutions provider serving wind and
power grid industry leaders, today reported financial results for
its first quarter of fiscal 2016 ended June 30, 2016.
Revenues for the first quarter of fiscal 2016
were $13.3 million, compared with $23.7 million for the same period
of fiscal 2015. The year over year decrease in revenues was largely
due to lower Wind segment revenues during the first quarter of
fiscal 2016.
AMSC’s net loss for the first quarter of fiscal
2016 increased to $10.4 million, or $0.76 per share, from $9.1
million, or $0.75 per share, for the same period of fiscal 2015.
The Company’s non-GAAP net loss for the first quarter of fiscal
2016 was $8.7 million, or $0.64 per share, which stayed flat
compared with a non-GAAP net loss of $8.7 million, or $0.72 per
share, in the same period of fiscal 2015. Please refer to the
financial table below for a reconciliation of GAAP to non-GAAP
results.
Cash, cash equivalents, and restricted cash at
June 30, 2016 totaled $36.6 million, compared with $40.7
million at March 31, 2016.
“Considering the working capital constraints of
our largest customer, Inox Wind, in the first quarter, our
financial performance was in line with our expectations,” said
Daniel P. McGahn, President and CEO, AMSC. “We remain focused on
executing on our objectives for fiscal 2016 and we believe that our
wind segment will generate stronger revenues in the quarters
ahead.”
Business Outlook“While Inox has completed
making the necessary pre-payments under the contracts executed last
December, shipments of our electrical control systems to Inox are
expected to be back end loaded in the second quarter,” said
McGahn. For the second quarter ending September 30,
2016, AMSC expects that its revenues will be in the range of $16.0
million to $18.0 million. The Company’s net loss for the second
quarter of fiscal 2016 is expected to be less than $12.5 million,
or $0.88 per share. In addition, AMSC expects that its
non-GAAP net loss (as defined below) for the second quarter of
fiscal 2016 will be less than $12.0 million, or $0.85 per
share.
Conference Call ReminderIn
conjunction with this announcement, AMSC management will
participate in a conference call with investors beginning at 10:00
a.m. Eastern Time today to discuss the Company’s financial results
and business outlook. 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 785-830-1916 and
using conference ID 4754410.
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 are 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 StatementsThis 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 our
expectations regarding anticipated financial results, the strength
of future revenues in our Wind segment, the timing of shipments of
electric control systems to Inox, 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. These
important factors include, but are not limited to: A significant
portion of our revenues are derived from a single customer, Inox,
and shipments to Inox may not commence in the time frame we expect
or at all; We have a history of operating losses and negative
operating cash flows, which may continue in the future and require
us additional financing in the future; Our operating results may
fluctuate significantly from quarter to quarter and may fall below
expectations in any particular fiscal quarter; 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; Our
success is dependent upon attracting and retaining qualified
personnel and our inability to do so could significantly damage our
business and prospects; We rely upon third-party suppliers for the
components and sub-assemblies of many of our Wind and Grid
products, making us vulnerable to supply shortages and price
fluctuations; We may not realize all of the sales expected from our
backlog of orders and contracts; 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; We
face risks related to our intellectual property; We face risks
related to our legal proceedings; 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, 2016, and our
other reports filed with the SEC. These important factors, 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.
|
UNAUDITED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In thousands, except per share
data) |
|
|
Three months ended June 30, |
|
2016 |
|
2015 |
Revenues |
|
|
|
Wind |
$ |
5,675 |
|
|
$ |
18,164 |
|
Grid |
7,670 |
|
|
5,559 |
|
Total revenues |
$ |
13,345 |
|
|
$ |
23,723 |
|
|
|
|
|
Cost of revenues |
12,482 |
|
|
20,503 |
|
|
|
|
|
Gross profit |
863 |
|
|
3,220 |
|
|
|
|
|
Operating
expenses: |
|
|
|
Research and development |
2,952 |
|
|
3,162 |
|
Selling, general and
administrative |
7,216 |
|
|
7,535 |
|
Impairment of minority interest
investment |
— |
|
|
741 |
|
Amortization of acquisition related
intangibles |
39 |
|
|
39 |
|
Total operating expenses |
10,207 |
|
|
11,477 |
|
|
|
|
|
Operating loss |
(9,344 |
) |
|
(8,257 |
) |
|
|
|
|
Change in fair value of
derivatives and warrants |
(678 |
) |
|
800 |
|
Interest expense,
net |
(135 |
) |
|
(318 |
) |
Other income (expense),
net |
126 |
|
|
(772 |
) |
Loss before income tax
expense |
(10,031 |
) |
|
(8,547 |
) |
|
|
|
|
Income tax expense |
324 |
|
|
574 |
|
|
|
|
|
Net loss |
$ |
(10,355 |
) |
|
$ |
(9,121 |
) |
|
|
|
|
Net loss per common
share |
|
|
|
Basic |
$ |
(0.76 |
) |
|
$ |
(0.75 |
) |
Diluted |
$ |
(0.76 |
) |
|
$ |
(0.75 |
) |
|
|
|
|
Weighted average number
of common shares outstanding |
|
|
|
Basic |
13,676 |
|
|
12,111 |
|
Diluted |
13,676 |
|
|
12,111 |
|
|
UNAUDITED CONSOLIDATED BALANCE
SHEET |
(In thousands, except per share
data) |
|
|
June 30, 2016 |
|
March 31, 2016 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and cash equivalents |
$ |
35,211 |
|
|
$ |
39,330 |
|
Accounts receivable, net |
7,039 |
|
|
19,264 |
|
Inventory |
28,887 |
|
|
18,512 |
|
Prepaid expenses and other current
assets |
4,086 |
|
|
5,778 |
|
Restricted cash |
441 |
|
|
457 |
|
Total current assets |
75,664 |
|
|
83,341 |
|
|
|
|
|
Property, plant and equipment,
net |
48,318 |
|
|
49,778 |
|
Intangibles, net |
712 |
|
|
854 |
|
Restricted cash |
934 |
|
|
934 |
|
Deferred tax assets |
94 |
|
|
96 |
|
Other assets |
329 |
|
|
315 |
|
Total assets |
$ |
126,051 |
|
|
$ |
135,318 |
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
Accounts payable and accrued
expenses |
$ |
24,694 |
|
|
$ |
23,156 |
|
Note payable, current portion, net
of discount of $119 as of June 30, 2016 and $42 as of March 31,
2016 |
3,047 |
|
|
2,624 |
|
Derivative liabilities |
3,905 |
|
|
3,227 |
|
Deferred revenue |
12,752 |
|
|
12,000 |
|
Total current liabilities |
44,398 |
|
|
41,007 |
|
|
|
|
|
Note payable, net of discount of
$133 as of March 31, 2016 |
— |
|
|
1,367 |
|
Deferred revenue |
8,344 |
|
|
9,269 |
|
Deferred tax liabilities |
63 |
|
|
63 |
|
Other liabilities |
57 |
|
|
63 |
|
Total liabilities |
52,862 |
|
|
51,769 |
|
|
|
|
|
Commitments and
contingencies (Note 12) |
|
|
|
|
|
|
|
Stockholders'
equity: |
|
|
|
Common Stock |
143 |
|
|
141 |
|
Additional paid-in capital |
1,012,918 |
|
|
1,011,813 |
|
Treasury stock |
(1,341 |
) |
|
(881 |
) |
Accumulated other comprehensive
income |
8 |
|
|
660 |
|
Accumulated deficit |
(938,539 |
) |
|
(928,184 |
) |
Total stockholders' equity |
73,189 |
|
|
83,549 |
|
Total liabilities and stockholders'
equity |
$ |
126,051 |
|
|
$ |
135,318 |
|
|
UNAUDITED CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(In thousands) |
|
|
Three months ended June 30, |
|
2016 |
|
2015 |
Cash flows from
operating activities: |
|
|
|
|
|
|
|
Net loss |
$ |
(10,355 |
) |
|
$ |
(9,121 |
) |
Adjustments to reconcile net loss
to net cash used in operations: |
|
|
|
Depreciation and amortization |
1,871 |
|
|
2,028 |
|
Stock-based compensation
expense |
999 |
|
|
1,128 |
|
Impairment of minority interest
investment |
— |
|
|
746 |
|
Provision for excess and obsolete
inventory |
272 |
|
|
602 |
|
Write-off prepaid taxes |
— |
|
|
820 |
|
Loss from minority interest
investment |
— |
|
|
356 |
|
Change in fair value of derivatives
and warrants |
678 |
|
|
(800 |
) |
Non-cash interest expense |
56 |
|
|
111 |
|
Other non-cash items |
(307 |
) |
|
553 |
|
Changes in operating asset and
liability accounts: |
|
|
|
Accounts receivable |
12,192 |
|
|
1,414 |
|
Inventory |
(10,750 |
) |
|
2,968 |
|
Prepaid expenses and other current
assets |
1,555 |
|
|
271 |
|
Accounts payable and accrued
expenses |
1,650 |
|
|
(3,024 |
) |
Deferred revenue |
79 |
|
|
(1,087 |
) |
Net cash used in operating
activities |
(2,060 |
) |
|
(3,035 |
) |
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Net cash used in investing
activities |
(271 |
) |
|
(64 |
) |
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Net cash (used in) / provided by
financing activities |
(1,461 |
) |
|
21,183 |
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents |
(327 |
) |
|
(13 |
) |
|
|
|
|
Net (decrease) /
increase in cash and cash equivalents |
(4,119 |
) |
|
18,071 |
|
Cash and cash
equivalents at beginning of period |
39,330 |
|
|
20,490 |
|
Cash and cash
equivalents at end of period |
$ |
35,211 |
|
|
$ |
38,561 |
|
|
RECONCILIATION OF GAAP NET INCOME (LOSS) TO
NON-GAAP NET INCOME (LOSS) |
(In thousands, except per share
data) |
|
|
Three months ended June 30, |
|
2016 |
|
2015 |
Net loss |
$ |
(10,355 |
) |
|
$ |
(9,121 |
) |
Stock-based
compensation |
999 |
|
|
1,128 |
|
Amortization of
acquisition-related intangibles |
39 |
|
|
39 |
|
Impairment of minority
interest investment |
— |
|
|
741 |
|
Consumption of zero
cost-basis inventory |
(158 |
) |
|
(846 |
) |
Change in fair value of
derivatives and warrants |
678 |
|
|
(800 |
) |
Non-cash interest
expense |
56 |
|
|
111 |
|
Tax effect of
adjustments |
25 |
|
|
$ |
— |
|
Non-GAAP net loss |
$ |
(8,716 |
) |
|
$ |
(8,748 |
) |
|
|
|
|
Non-GAAP loss per
share |
$ |
(0.64 |
) |
|
$ |
(0.72 |
) |
Weighted average shares
outstanding - basic and diluted |
13,676 |
|
|
12,111 |
|
|
|
|
Reconciliation of Forecast GAAP Net Loss to
Non-GAAP Net Loss |
|
(In millions, except per share
data) |
|
|
|
|
|
Three months ending |
|
September 30, 2016 |
|
Net loss |
$ |
(12.5 |
) |
|
Stock-based
compensation |
|
|
0.7 |
|
|
|
Consumption of
zero-cost inventory |
|
|
(0.2 |
) |
|
|
Non-GAAP net loss |
$ |
(12.0 |
) |
|
Non-GAAP net loss per
share |
$ |
(0.85 |
) |
|
Shares outstanding |
|
14.1 |
|
|
Note: Non-GAAP net loss is defined by the
Company as net loss before stock-based compensation; amortization
of acquisition-related intangibles; impairment of minority interest
investment; consumption of zero cost-basis inventory; non-cash
interest expense; change in fair value of derivatives and warrants;
and other unusual charges, net of any tax effects related to these
items. The Company believes non-GAAP net loss assists management
and investors in comparing the Company’s performance across
reporting periods on a consistent basis by excluding these
non-cash, non-recurring or other charges that it does not believe
are indicative of its core operating performance. The Company also
regards non-GAAP net loss as a useful measure of operating
performance to complement operating loss, net loss and other GAAP
financial performance measures. In addition, the Company uses
non-GAAP net loss as a factor in evaluating management’s
performance when determining incentive compensation and to evaluate
the effectiveness of its business strategies.
Generally, a non-GAAP financial measure is a
numerical measure of a company's performance, financial position or
cash flow that either excludes or includes amounts that are not
normally excluded or included in the most directly comparable
measure calculated and presented in accordance with GAAP. The
non-GAAP measures included in this release, however, should be
considered in addition to, and not as a substitute for or superior
to, operating income, cash flows, or other measures of financial
performance prepared in accordance with GAAP. A reconciliation of
non-GAAP to GAAP net loss is set forth in the table above.
AMSC Contact:
Brion D. Tanous
AMSC Investor Relations
Phone: 424-634-8592
Email: Brion.Tanous@amsc.com
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