DOW JONES NEWSWIRES
A123 Systems Inc.'s (AONE) first-quarter loss widened on higher
costs, which more than offset a small increase in revenue, as
results for the developer of lithium-ion battery technology came in
under Wall Street's expectations.
Separately, the company announced it had been tapped by
industrial manufacturer Eaton Corp. (ETN) to supply battery systems
for production of a hybrid power system to be installed on a Ford
Motor Co. (F) F550 based Plug-in Hybrid Electric Vehicle. The
program is partially funded by a $45 million grant administered by
the U.S. Department of Energy.
Shares rose 1.2% to $10.28 in after-hours trading. The company's
stock has been volatile since its September initial public offering
as A123's fortunes are likely to rise and fall along with the
electric-vehicle market, which analysts predict will start rolling
in 2012. So far this year, the stock has lost about half of its
value.
While the company participates in a segment of the auto industry
that is new and growing, it's unclear how much of that market
A123's technology will capture as it battles larger rivals with
years of experience in making batteries.
On Tuesday, A123 posted a loss of $29 million, compared with a
year-earlier loss of $18.7 million. The per-share figure was 28
cents in the latest quarter compared with $2.02 a year earlier
because outstanding shares increased to 103.6 million from just 9.3
million. Revenue grew 5.4% to $24.5 million.
Analysts surveyed by Thomson Reuters expected a loss of 22 cents
on revenue of $25 million.
Total costs climbed 24% to $26.5 million.
-By John Kell, Dow Jones Newswires; 212-416-2480;
john.kell@dowjones.com