Ideal Power Reports Second Quarter 2017 Financial Results
August 10 2017 - 4:01PM
Ideal Power Inc. (NASDAQ:IPWR), an innovative power conversion
technology company, reported results for the three and six months
ended June 30, 2017.
Key Second Quarter 2017 and Subsequent
Highlights:
- Signed a master purchase agreement with NEXTracker for
solar-plus-storage products utilizing the company’s SunDial™ series
PV string inverter and Stabiliti™ power conversion systems (PCS)
for commercial, industrial and utility sites throughout North
America.
- Received a purchase order for 35 units of Stabiliti™ 30kW PCS
from an existing global technology customer for a
solar-plus-storage integration project in a California school
district.
- Partnered with W Energies Solar One to deploy a grid-resilient
commercial solar-plus storage microgrid system in Texas.
- Partnered with Azimuth Energy for a 300 kilowatt / 500
kilowatt-hour remote solar-plus-storage microgrid in New York
commercial facility.
- Deployed six Stabiliti 30C3 multi-port PCS in a collaborative
hybrid microgrid project for a commercial facility in Saint Croix,
U.S. Virgin Islands.
- Strengthened patent estate: currently have 71 issued patents,
including 29 issued patents for B-TRAN™ with a similar number of
patent applications pending.
"The second quarter of 2017 was highlighted by our new strategic
initiative in the solar-plus-storage and microgrid markets and the
completed product migration to our next generation 30kW Stabiliti
and SunDial series,” said Dan Brdar, Chief Executive Officer. “The
shift in our strategic direction in combination with our innovative
multi-port power conversion systems has opened doors in these
markets and contributed to multiple orders in the second quarter
and a major order in the third quarter with a global technology
company. Unlike the standalone storage market, which has been
slow to transact, the solar-plus-storage market leverages the
mature and global solar market and is already transacting as such
storage solves key end customer demand management, backup and
critical load support problems that solar-only solutions
cannot.”
Concluded Brdar, “The third quarter of 2017 is starting off on a
strong note as we recently signed a master purchase agreement with
NEXTracker for our SunDial™ series PV string inverter and
Stabiliti™ PCS for commercial, industrial and utility sites
throughout North America.”
Second Quarter 2017 Financial Results
- Q2 2017 product revenue remained unchanged at $0.3 million
versus Q2 2016.
- Q2 2017 gross margins were negative 202% compared to 7.2% gross
margins in Q2 2016, primarily attributable to the non-cash write
down of legacy product inventory. The company discontinued
its legacy product families and completed its transition to the
company’s next generation 30kW Stabiliti™ and SunDial™ product
families during Q2 2017.
- Q2 2017 net loss was $3.2 million compared to $2.5 million in
Q2 2016, largely as a result of non-cash charges.
- Q2 2017 cash used in operating and investing activities was
$2.0 million compared to $2.5 million in Q1 2017 and $2.7 million
in Q2 2016.
- Cash and cash equivalents totalled $13.3 million as of June 30,
2017, with no long-term debt outstanding.
“The second quarter of 2017 was a period of transition for the
company as we shifted our strategic focus from the slow-moving
standalone storage market to the solar-plus-storage and microgrid
markets, and discontinued our legacy product families in advance of
the new UL1741 SA standards,” said Tim Burns, Chief Financial
Officer. “Certification to this new standard will be
required in many U.S. markets and power conversion products not
certified to this standard will not be allowed to be installed in
these markets after October 9th. In connection with this
transition, we recorded a write-down of our finished goods and
component inventory for our legacy products. In addition, as a
result of our exclusive focus on our next generation 30kW products
and our aggressive company-wide cost reduction plan, we were able
to reduce our cash burn to $2.0 million in the second quarter, a
level lower than reported in any of the preceding eight
quarters.”
“We now have a clean slate for what we believe will be a revenue
ramp beginning in the second half of 2017 and accelerating in 2018
driven by growth in the solar-plus-storage and microgrid markets,”
said Ideal Power Chairman Lon Bell. “While we believe the
growth will be modest in the third quarter, we anticipate a strong
fourth quarter to finish the year.”
Conference Call Details
Ideal Power CEO Dan Brdar and CFO Tim Burns will host the
conference call, followed by a question and answer period.
To access the call, please use the following information:
Date: |
|
Thursday, August 10,
2017 |
Time: |
|
4:30 p.m. ET, 1:30 p.m.
PT |
Toll-free dial-in
number: |
|
1-877-874-1586 |
International dial-in
number: |
|
1-719-457-2634 |
Conference ID: |
|
7601500 |
Please call the conference telephone
number 5-10 minutes prior to the start time. An operator will
register your name and organization. If you have any difficulty
connecting with the conference call, please contact MZ Group at
1-949-491-8235.
The conference call will be broadcast live and available for
replay at http://public.viavid.com/index.php?id=125651 and via the
investor relations section of the Company’s website at
www.IdealPower.com.
A replay of the conference call will be available after 7:30
p.m. Eastern time through September 10, 2017.
Toll-free replay
number: |
|
1-844-512-2921 |
International replay
number: |
|
1-412-317-6671 |
Replay ID: |
|
7601500 |
About Ideal Power
Inc.Ideal Power (NASDAQ:IPWR) is a power conversion
technology company that delivers efficient and compact solutions to
system integrators and project developers to connect distributed
energy resources to the grid. Ideal Power’s products offer enhanced
performance for battery-enabled applications at a competitive cost,
backed by first-rate customer service. With its patented power
conversion technology, Ideal Power supports a broad set of growing
markets, including solar photovoltaics, battery energy storage,
mobile power and microgrids. For more information, visit
www.IdealPower.com.
Safe Harbor StatementAll statements in this
release that are not based on historical fact are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 and the provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. Forward-looking
statements in this press release include our statements that we
expect revenue to ramp in the second half of 2017 and 2018 driven
by growth in the solar-plus-storage and microgrid markets, that we
anticipate a strong fourth quarter to finish the year, that the
shift in our strategic direction will be successful, and that the
purchase agreement with NEXTracker will be successful. While
management has based any forward-looking statements included in
this release on its current expectations, the information on which
such expectations were based may change. These forward-looking
statements rely on a number of assumptions concerning future events
and are subject to a number of risks, uncertainties and other
factors, many of which are outside of our control that could cause
actual results to materially differ from such statements. Such
risks, uncertainties, and other factors include, but are not
limited to, whether the patents for our technology provide adequate
protection and whether we can be successful in maintaining,
enforcing and defending our patents, the timing and impact of
regulatory developments affecting the markets for our products, our
inability to predict with precision or certainty the pace of
development and commercialization of our advanced technologies,
unanticipated costs in connection with the discontinuation our
legacy product families, the uncertainty of whether the demand for
energy storage products will grow at a pace consistent with our
expectations, whether our backlog will translate into revenue in
future periods, whether demand for our products, which we believe
are disruptive, will develop, and whether we can compete
successfully with other manufacturers and suppliers of power
conversion products, both now and in the future, as new products
are developed and marketed and other risks and uncertainties set
forth in our quarterly and annual reports filed with the Securities
and Exchange Commission. Furthermore, we operate in a highly
competitive and rapidly changing environment where new and
unanticipated risks may arise. The availability and amount of
government incentive programs affect our customers spending
patterns, and adverse changes or developments in such programs –
such as the SGIP in California – have materially and adversely
affected our orders, net sales, gross profit and net income, and
may do so again in the future. Accordingly, investors should
not place any reliance on forward-looking statements as a
prediction of actual results. We disclaim any intention to, and
undertake no obligation to, update or revise forward-looking
statements.
IDEAL POWER INC.Balance
Sheets |
|
|
|
June 30,
2017 |
|
December 31, 2016 |
|
|
(unaudited) |
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and
cash equivalents |
|
$ |
13,335,908 |
|
|
$ |
4,204,916 |
|
Accounts
receivable, net |
|
205,646 |
|
|
378,658 |
|
Inventories, net |
|
366,535 |
|
|
1,245,147 |
|
Prepayments and other current assets |
|
252,532 |
|
|
312,593 |
|
Total
current assets |
|
14,160,621 |
|
|
6,141,314 |
|
|
|
|
|
|
Property and equipment,
net |
|
751,138 |
|
|
936,486 |
|
Intangible assets,
net |
|
2,099,182 |
|
|
1,905,556 |
|
Other assets |
|
— |
|
|
17,920 |
|
Total
Assets |
|
$ |
17,010,941 |
|
|
$ |
9,001,276 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts
payable |
|
$ |
212,984 |
|
|
$ |
346,767 |
|
Accrued
expenses |
|
1,180,282 |
|
|
1,149,129 |
|
Total
current liabilities |
|
1,393,266 |
|
|
1,495,896 |
|
|
|
|
|
|
Other long-term
liabilities |
|
489,941 |
|
|
265,418 |
|
Total
liabilities |
|
1,883,207 |
|
|
1,761,314 |
|
|
|
|
|
|
Commitments and
contingencies (see Note 8) |
|
|
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
|
Preferred
stock, $0.001 par value; 10,000,000 shares authorized; 1,518,430
sharesissued and outstanding at June 30, 2017 |
|
1,518 |
|
|
— |
|
Common
stock, $0.001 par value; 50,000,000 shares authorized; 13,998,465
shares issued and 13,996,782 shares outstanding at
June 30, 2017 and 9,560,896 sharesissued and 9,559,213 shares
outstanding at December 31, 2016, respectively |
|
13,998 |
|
|
9,561 |
|
Additional paid-in capital |
|
66,471,006 |
|
|
52,310,481 |
|
Treasury
stock, at cost; 1,683 shares at June 30, 2017 and December 31,
2016 |
|
(5,915 |
) |
|
(5,915 |
) |
Accumulated deficit |
|
(51,352,873 |
) |
|
(45,074,165 |
) |
Total
stockholders’ equity |
|
15,127,734 |
|
|
7,239,962 |
|
Total
Liabilities and Stockholders’ Equity |
|
$ |
17,010,941 |
|
|
$ |
9,001,276 |
|
IDEAL POWER INC.Statements of
Operations(unaudited) |
|
|
|
|
|
|
|
Three Months Ended June 30, |
|
Six Months Ended June 30, |
|
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Product revenue |
|
$ |
253,370 |
|
|
$ |
322,116 |
|
|
$ |
529,040 |
|
|
$ |
818,760 |
|
Cost of product
revenue |
|
764,609 |
|
|
298,937 |
|
|
1,475,539 |
|
|
793,691 |
|
Gross
profit (loss) |
|
(511,239 |
) |
|
23,179 |
|
|
(946,499 |
) |
|
25,069 |
|
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research
and development |
|
1,108,368 |
|
|
1,203,179 |
|
|
2,298,537 |
|
|
2,683,164 |
|
General
and administrative |
|
1,170,415 |
|
|
881,659 |
|
|
2,076,378 |
|
|
1,801,990 |
|
Sales and
marketing |
|
427,336 |
|
|
412,433 |
|
|
968,869 |
|
|
824,963 |
|
Total
operating expenses |
|
2,706,119 |
|
|
2,497,271 |
|
|
5,343,784 |
|
|
5,310,117 |
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
(3,217,358 |
) |
|
(2,474,092 |
) |
|
(6,290,283 |
) |
|
(5,285,048 |
) |
|
|
|
|
|
|
|
|
|
Interest income,
net |
|
7,034 |
|
|
6,615 |
|
|
11,575 |
|
|
15,224 |
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(3,210,324 |
) |
|
$ |
(2,467,477 |
) |
|
$ |
(6,278,708 |
) |
|
$ |
(5,269,824 |
) |
|
|
|
|
|
|
|
|
|
Net loss per share –
basic and fully diluted |
|
$ |
(0.23 |
) |
|
$ |
(0.26 |
) |
|
$ |
(0.50 |
) |
|
$ |
(0.55 |
) |
|
|
|
|
|
|
|
|
|
Weighted average number
of shares outstanding – basic and fully diluted |
|
13,989,282 |
|
|
9,547,747 |
|
|
12,443,076 |
|
|
9,546,864 |
|
IDEAL POWER INC.Statements of
Cash Flows(unaudited) |
|
|
|
Six Months Ended June 30, |
|
|
2017 |
|
2016 |
Cash flows from
operating activities: |
|
|
|
|
Net
loss |
|
$ |
(6,278,708 |
) |
|
$ |
(5,269,824 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
Allowance
for doubtful accounts |
|
273,727 |
|
|
15,475 |
|
Write-down of inventory |
|
712,083 |
|
|
12,590 |
|
Depreciation and amortization |
|
224,926 |
|
|
184,279 |
|
Write-off
of capitalized patents |
|
202,343 |
|
|
48,773 |
|
Write-off
of fixed assets |
|
15,036 |
|
|
1,215 |
|
Stock-based compensation |
|
498,006 |
|
|
763,326 |
|
Decrease
(increase) in operating assets: |
|
|
|
|
Accounts
receivable |
|
(100,715 |
) |
|
446,261 |
|
Inventories |
|
166,529 |
|
|
(627,650 |
) |
Prepayments and other current assets |
|
77,981 |
|
|
60,427 |
|
Increase
(decrease) in operating liabilities: |
|
|
|
|
Accounts
payable |
|
(133,783 |
) |
|
(234,486 |
) |
Accrued
expenses |
|
(5,627 |
) |
|
(405,761 |
) |
Net cash
used in operating activities |
|
(4,348,202 |
) |
|
(5,005,375 |
) |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
Purchase
of property and equipment |
|
(18,146 |
) |
|
(297,095 |
) |
Acquisition of intangible assets |
|
(171,134 |
) |
|
(203,500 |
) |
Net cash
used in investing activities |
|
(189,280 |
) |
|
(500,595 |
) |
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
Net
proceeds from issuance of stock |
|
13,657,331 |
|
|
— |
|
Exercise
of options and warrants |
|
11,143 |
|
|
35,536 |
|
Net cash
provided by financing activities |
|
13,668,474 |
|
|
35,536 |
|
|
|
|
|
|
Net increase (decrease)
in cash and cash equivalents |
|
9,130,992 |
|
|
(5,470,434 |
) |
Cash and cash
equivalents at beginning of period |
|
4,204,916 |
|
|
15,022,286 |
|
Cash and cash
equivalents at end of period |
|
$ |
13,335,908 |
|
|
$ |
9,551,852 |
|
Ideal Power Media Contact:
Antenna
Sharon Golubchik
201-465-8008
idealpower@antennagroup.com
Ideal Power Investor Relations Contact:
MZ North America
Chris Tyson
949-491-8235
IPWR@mzgroup.us
www.mzgroup.us
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