CDTi Announces Second Quarter 2017 Financial Results
August 14 2017 - 04:05PM
Clean Diesel Technologies, Inc. (Nasdaq:CDTI) (“CDTi” or “the
Company”), a leader in advanced emission control technology,
reported its financial results for the second quarter ended June
30, 2017.
Matthew Beale, CDTi’s CEO, stated, “We are nearing our goal to
complete CDTi’s transition to an advanced materials and specialty
coating business model by the end of 2017. Shipments of our
advanced materials to commercial partners in China and India are
set to begin during the fourth quarter and forward revenue
visibility continues to increase for both cost-down and new
vehicles programs. We have successfully adapted our
technology for deployment in two-wheel and selective catalytic
reduction (SCR) applications that offer additional near-term
revenue opportunities. Our restructuring and repositioning
initiatives have begun to translate into improved financial results
with both operating loss and cash burn decreasing significantly
during the second quarter. CDTi is nearing the end stages of
transitioning to a scalable technology company, providing us with a
solid platform to support the ramp of our new powder business in
2018 and 2019.”
Financial Highlights: Second Quarter 2017 compared to
Second Quarter 2016
- Total revenue was $8.4 million for both periods.- Coated
catalyst revenue was $4.8 million in both periods.- Emissions
control systems revenue was $3.0 million, compared to $2.9
million.- Technology and advanced materials revenue was $0.6
million in both periods.
- Gross margin was 23%, compared to 20%. The increase primarily
reflects a more favorable revenue mix.
- Total operating expenses in the second quarter of 2017 were
$2.3 million, compared to $4.8 million in the second quarter of
2016. The decrease reflects the positive effects of the company’s
cost reduction initiatives undertaken in 2016 as well as a
reduction in the liability related to the exit of our Canadian
manufacturing facility. The Company achieved its goal to
reduce ongoing operating expenses to $3.0 million in the second
quarter and anticipates that operating expense will continue at
this level or lower for the remainder of the year.
- Net loss was $385,000, or $0.02 per share, compared to a net
loss of $222,000, or $0.06 per share in the second quarter of
2016.
- Cash at June 30, 2017 was $1.6 million, compared to $7.8
million at December 31, 2016 including a $600,000 decrease in our
line of credit since the first quarter.
Financial Highlights: Six months ended June 30, 2017
compared to 2016
- Total revenue for the first six months of 2017 was $16.6
million, compared to $18.2 million for the same prior year
period.
- Gross margin was 20%, compared to 24% in the same prior year
period.
- Total operating expenses for the first six months of 2017 were
$6.1 million compared to $10.8 million in the same prior year
period.
- Net loss for the first six months of 2017 was $3.5 million, or
$0.22 per share, compared to net loss of $3.0 million, or $0.80 per
share, in the same prior year period.
Financial OutlookBased on CDTi’s current
business configuration as well as its second quarter results, the
company continues to expect revenue to be between $32.0 million and
$35.0 million and gross margin to be between 23% and 25%.
Conference Call and Webcast InformationCDTi
will host a conference call and live webcast beginning at 2:00 p.m.
Pacific Time today, August 14th to discuss its financial results
and its business outlook. This conference call will contain
forward-looking information. To participate in the conference call,
please dial +1 (877) 303-9240 and international participants should
dial +1 (760) 666-3571. The conference code is 59723228. The
conference call will be webcast live on the CDTi website at
www.cdti.com under the "Investor Relations" section. To listen to
the live webcast, participants should visit the site at least 15
minutes prior to the conference to download any required streaming
media software. An archived recording of the conference call will
be available on the CDTi website for 30 days. You may also access a
telephone replay for two business days following the conclusion of
the call by dialing +1 (855) 859-2056 or +1 (404) 537-3406 if
dialing in internationally. The passcode is 59723228.
About CDTiCDTi develops advanced materials
technology for the emissions control market. CDTi’s proprietary
technologies provide high-value sustainable solutions to reduce
hazardous emissions, increase energy efficiency and lower the
carbon intensity of on- and off-road combustion engine systems.
With a continuing focus on innovation-driven commercialization and
global expansion, CDTi’s breakthrough Powder-to-Coat (P2C™)
technology exploits the Company’s high-performance, advanced
low-platinum group metal (PGM) emission reduction catalysts. Key
technology platforms include Mixed Phase Catalyst (MPC®), Base
Metal Activated Rhodium Support (BMARS™), Synergized PGM (SPGM™),
Zero PGM (ZPGM™) and Spinel™. For more information, please visit
www.cdti.com.
Forward-Looking StatementsCertain information
contained in this press release constitutes forward-looking
statements, including any statements that are not statements of
historical fact. You can identify these forward-looking statements
by the use of the words “believes”, “expects”, “anticipates”,
“plans”, “may”, “will”, “would”, “intends”, “estimates”, and other
similar expressions, whether in the negative or affirmative.
Forward-looking statements are based on a series of expectations,
assumptions, estimates and projections, which involve substantial
uncertainty and risk. In this document, the Company includes
forward-looking statements regarding the acceleration of the
Company’s business transformation into an advanced materials
company, global trends in the automotive and heavy duty diesel
markets, the Company’s future financial performance, and the
performance of the Company’s technology, are all subject to risks
and uncertainties that could cause our actual results and financial
position to differ materially. In general, actual results may
differ materially from those indicated by such forward-looking
statements as a result of risks and uncertainties, including, but
not limited, to (i) that the Company may not be able to (a)
successfully implement, or implement at all, its strategic
priorities; (b) streamline its operations or align its organization
and infrastructure with the anticipated business; (c) meet
expectations or projections; (d) decrease costs; (e) increase
sales; (f) obtain adequate funding; (g) retain or secure customers;
(h) increase its customer base; (i) protect its intellectual
property; (j) successfully evolve into an advanced materials
supplier or, even if successful, increase profitability; (k)
successfully market new products; (l) obtain product
verifications or approvals; (m) attract or retain key personnel;
(n) validate, optimize and scale our powder-to-coat capability; or
(o) realize benefits from investments; (ii) funding for and
enforcement and tightening of emissions controls, standards and
regulations; (iii) prices of PGM and rare earth metals; (iv)
royalty and other restrictions on sales in certain Asian countries;
(v) supply disruptions or failures; (vi) regulatory, marketing and
competitive factors; (vii) environmental harm or damages; and
(viii) other risks and uncertainties discussed or referenced in the
Company’s filings with the Securities and Exchange Commission,
including its most recent Annual Report on Form 10-K and any
subsequent periodic reports on Form 10-Q and Form 8-K. In addition,
any forward-looking statements represent the Company’s estimates
only as of the date of such statements and should not be relied
upon as representing the Company’s estimates as of any subsequent
date. The Company specifically disclaims any obligation to update
forward-looking statements. All forward-looking statements in this
press release are qualified in their entirety by this cautionary
statement.
Contact Information: Becky Herrick or Cathy
MattisonLHA (IR Agency)+1 415 433 3777bherrick@lhai.com /
cmattison@lhai.com
[Tables to follow]
CLEAN DIESEL TECHNOLOGIES, INC. |
Condensed Consolidated Balance Sheet |
(in thousands) |
(unaudited) |
|
|
|
|
|
June 30, 2017 |
|
December 31, 2016 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash |
$ |
1,611 |
|
|
$ |
7,839 |
|
Accounts
receivable, net |
|
4,623 |
|
|
|
5,398 |
|
Inventories |
|
5,833 |
|
|
|
7,125 |
|
Prepaid
expenses and other current assets |
|
978 |
|
|
|
968 |
|
Total
current assets |
|
13,045 |
|
|
|
21,330 |
|
Property and equipment,
net |
|
1,031 |
|
|
|
1,158 |
|
Intangible assets,
net |
|
1,267 |
|
|
|
1,483 |
|
Deferred tax
assets |
|
561 |
|
|
|
554 |
|
Other assets |
|
347 |
|
|
|
305 |
|
Total
assets |
$ |
16,251 |
|
|
$ |
24,830 |
|
LIABILITIES AND
STOCKHOLDERS’ EQUITY |
|
|
|
Current
liabilities: |
|
|
|
Line of
credit |
$ |
672 |
|
|
$ |
1,458 |
|
Shareholder notes payable |
|
— |
|
|
|
1,803 |
|
Accounts
payable |
|
4,145 |
|
|
|
5,979 |
|
Accrued
expenses and other current liabilities |
|
5,143 |
|
|
|
6,345 |
|
Income
taxes payable |
|
693 |
|
|
|
642 |
|
Total
current liabilities |
|
10,653 |
|
|
|
16,227 |
|
Commitments and
contingencies |
|
|
|
Stockholders’
equity: |
|
|
|
Preferred stock, par
value $0.01 per share: authorized 100,000; no shares issued and
outstanding |
|
— |
|
|
|
— |
|
Common stock, par value
$0.01 per share: authorized 50,000,000; issued and outstanding
15,722,537 and 15,703,301 shares at June 30, 2017 and
December 31, 2016, respectively |
|
157 |
|
|
|
157 |
|
Additional paid-in
capital |
|
238,093 |
|
|
|
237,838 |
|
Accumulated other
comprehensive loss |
|
(6,108 |
) |
|
|
(6,329 |
) |
Accumulated
deficit |
|
(226,544 |
) |
|
|
(223,063 |
) |
Total stockholders’
equity |
|
5,598 |
|
|
|
8,603 |
|
Total liabilities and
stockholders’ equity |
$ |
16,251 |
|
|
$ |
24,830 |
|
|
CLEAN DIESEL TECHNOLOGIES, INC. |
Condensed Consolidated Statement of Operations |
(in thousands, except percentage and per share
amounts) |
(unaudited) |
|
|
Three Months Ended June
30, |
|
|
|
Six Months Ended June
30, |
|
|
2017 |
|
% of Revenues |
|
|
2016 |
|
% of Revenues |
|
|
|
2017 |
|
% of Revenues |
|
|
2016 |
|
% of Revenues |
|
|
|
|
As Restated |
|
|
|
|
|
|
As Restated |
|
Coated catalysts |
$ |
4,821 |
|
57 |
% |
|
$ |
4,830 |
|
58 |
% |
|
|
$ |
9,291 |
|
56 |
% |
|
$ |
10,441 |
|
58 |
% |
Emission control
systems |
|
3,011 |
|
36 |
% |
|
|
2,946 |
|
35 |
% |
|
|
|
6,553 |
|
39 |
% |
|
|
6,862 |
|
37 |
% |
Technology and advanced
materials |
|
567 |
|
7 |
% |
|
|
630 |
|
7 |
% |
|
|
|
769 |
|
5 |
% |
|
|
849 |
|
5 |
% |
Revenues |
$ |
8,399 |
|
100 |
% |
|
$ |
8,406 |
|
100 |
% |
|
|
$ |
16,613 |
|
100 |
% |
|
$ |
18,152 |
|
100 |
% |
Gross profit |
|
1,944 |
|
|
|
|
1,687 |
|
|
|
|
|
3,378 |
|
|
|
|
4,424 |
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
|
|
|
|
Research
and development |
|
987 |
|
|
|
|
1,431 |
|
|
|
|
|
2,056 |
|
|
|
|
3,193 |
|
|
Selling,
general and administrative |
|
1,916 |
|
|
|
|
2,827 |
|
|
|
|
|
4,642 |
|
|
|
|
6,227 |
|
|
Severance
and other charges |
|
(619 |
) |
|
|
|
581 |
|
|
|
|
|
(619 |
) |
|
|
|
1,373 |
|
|
Total
operating expenses |
|
2,284 |
|
|
|
|
4,839 |
|
|
|
|
|
6,079 |
|
|
|
|
10,793 |
|
|
Loss from
operations |
|
(340 |
) |
|
|
|
(3,152 |
) |
|
|
|
|
(2,701 |
) |
|
|
|
(6,369 |
) |
|
Other income
(expense): |
|
|
|
|
|
|
|
|
|
|
|
|
Interest
expense |
|
(64 |
) |
|
|
|
(691 |
) |
|
|
|
|
(167 |
) |
|
|
|
(1,083 |
) |
|
Gain on
bifurcated derivative liability |
|
— |
|
|
|
|
2,754 |
|
|
|
|
|
— |
|
|
|
|
2,754 |
|
|
Loss on
extinguishment of debt |
|
— |
|
|
|
|
(1,630 |
) |
|
|
|
|
(194 |
) |
|
|
|
(1,630 |
) |
|
Gain
(loss) on change in fair value of liability-classified
warrants |
|
4 |
|
|
|
|
792 |
|
|
|
|
|
(334 |
) |
|
|
|
1,588 |
|
|
Other
income, net |
|
184 |
|
|
|
|
1,008 |
|
|
|
|
|
83 |
|
|
|
|
628 |
|
|
Total
other income (expense) |
|
124 |
|
|
|
|
2,233 |
|
|
|
|
|
(612 |
) |
|
|
|
2,257 |
|
|
Loss from
operations before income taxes |
|
(216 |
) |
|
|
|
(919 |
) |
|
|
|
|
(3,313 |
) |
|
|
|
(4,112 |
) |
|
Income
tax expense (benefit) |
|
169 |
|
|
|
|
(697 |
) |
|
|
|
|
168 |
|
|
|
|
(1,119 |
) |
|
Net
loss |
$ |
(385 |
) |
|
|
$ |
(222 |
) |
|
|
|
$ |
(3,481 |
) |
|
|
$ |
(2,993 |
) |
|
Basic and diluted net
loss per common share: |
|
|
|
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(0.02 |
) |
|
|
$ |
(0.06 |
) |
|
|
|
$ |
(0.22 |
) |
|
|
$ |
(0.80 |
) |
|
Weighted average shares
outstanding – basic and diluted |
|
15,708 |
|
|
|
|
3,848 |
|
|
|
|
|
15,706 |
|
|
|
|
3,747 |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
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