CDTi Announces First Quarter 2015 Financial Results
May 12 2015 - 8:00AM
Demonstrates Traction in the DPF Replacement
Market and Broadens Catalyst Portfolio
Holds Conference Call Today, May 12th, at 8:00
a.m. Pacific Time
Clean Diesel Technologies, Inc. (Nasdaq:CDTI) ("CDTi" or "the
Company"), a leader in advanced emission control technology,
reported financial results for the first quarter ended March 31,
2015.
Chris Harris, CDTi's President and CEO, stated: "In the first
quarter, our commercialization efforts drove results for DuraFit™
replacement diesel particulate filters (DPFs) and our broader
portfolio of advanced catalysts. We secured New York City's
Department of Sanitation as our first major fleet customer and have
since commenced shipments, and we are close to securing our first
national channel partner to distribute DuraFit DPFs. As expected,
our first quarter 2015 revenue declined 10.7% year-over-year due to
the wind-down of the California diesel retrofit mandate, but
increased 19.3% on a sequential basis. Gross margins also improved
457 basis points over the fourth quarter of 2014 to 27.3%. We met
our internal goal of $1.0 million in DuraFit sales in the first
quarter and are on track to achieve our guidance of $5.0 million
for the year. Meanwhile, we delivered another solid quarter in our
core catalyst business as auto demand in the U.S. reached a
multi-year high.
"CDTi's transition to an advanced materials company is well
underway. Initial vehicle test results indicate that our new
synergized-platinum group metal (SPGM™) diesel oxidation catalysts
(DOCs) can match the performance of leading DOCs in the market,
while using dramatically less platinum group metal (PGM). These
results also demonstrate our ability to invent innovative materials
that create significant value propositions in a range of downstream
markets. We intend to commercialize our SPGM DOC technology through
original equipment manufacturers (OEMs) and retrofit catalyst
suppliers via our powder-to-coat business model as well as
incorporate it into our DuraFit line of DPF replacement parts. We
expect to announce more vehicle test results in the second quarter,
including for three-way catalysts (TWCs) using Spinel™ and another
advanced materials platform."
Recent Highlights
- Secured first major fleet customer, the Department of
Sanitation New York (DSNY), for DuraFit DPFs.
- Announced initial engine and vehicle testing results
demonstrating CDTi's SPGM DOC technology achieved emission control
and system performance comparable to a leading OEM catalyst product
while slashing PGM usage by over 80%.
- Outlined the underpinnings of the Spinel technology for which
patents were granted in 2014 at the SAE 2015 World Congress on
April 22nd.
Financial Highlights – First Quarter 2015 compared to
First Quarter 2014
- Total revenue was $10.3 million compared to $11.6 million in
the first quarter of 2014.
- Catalyst division revenue was $6.8 million compared to $5.8
million due to increased demand from our Japanese OEM customer.
Heavy Duty Diesel Systems division revenue was $4.1 million
compared to $6.3 million due to a decrease in California retrofit
demand partially offset by $1.0 million of DuraFit DPFs sold in the
quarter. Intercompany sales are eliminated in consolidation.
- Gross margin was 27.3% compared to 32.3% for the year-ago
quarter, reflecting lower volumes of retrofits and carryover launch
costs associated with the DuraFit rollout.
- Total operating expenses were $5.5 million compared to
operating expenses of $5.2 million in the first quarter of 2014
reflecting increased R&D expense on development and vehicle
testing of catalysts based on new advanced materials.
- Net loss was $3.0 million, or $0.21 per share. This compares to
a loss of approximately $3.8 million, or $0.39 per share, in the
same period last year.
- The weighted average common shares outstanding were 14.2
million in the current quarter compared to 9.8 million in the first
quarter of 2014. The increase in the number of shares was due
principally to the two equity offerings completed in 2014.
- Cash at March 31, 2015 was $4.3 million, compared with $7.2
million at December 31, 2014.
David Shea, CDTi's CFO, stated: "We continue to make progress in
our transformation into an advanced materials company while
aggressively targeting near-term revenue opportunities with
DuraFit. As such, we are reaffirming our outlook for 2015. We
expect revenue of between $40 million and $45 million, as compared
to $41.2 million in 2014, and of that DuraFit is expected to
contribute $5.0 million. We expect a gross margin of between 25%
and 28%, approaching the 30% achieved in 2014. As DuraFit sales
ramp during 2015, we expect margins to improve in the back half of
the year as we reduce startup costs and optimize our supply
chain."
Conference Call and Webcast Information
CDTi will host a conference call and live webcast beginning at
8:00 a.m. Pacific Time today, May 12th, 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 use conference code 32482673.
International participants should dial +1 (760) 666 3571 and use
the same conference code. The conference call will be webcast live
on CDTi's 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
and a full transcript for one year.
About CDTi
CDTi manufactures and distributes vehicle emissions control
products that leverage its advanced materials technology. CDTi
utilizes its proprietary patented Mixed Phase Catalyst (MPC®)
technology and other related technologies to provide high-value
sustainable solutions to reduce emissions, increase energy
efficiency and lower the carbon intensity of on- and off-road
combustion engine systems. Reflecting its continued focus on
innovation, CDTi is developing and commercializing proprietary
advanced low-platinum group metal (PGM) catalysts including
synergized-PGM (SPGM™), as well as zero-PGM (ZPGM™) catalysts. CDTi
is headquartered in Oxnard, California and has operations in the
U.K., Canada, France, Japan and Sweden. For more information,
please visit www.cdti.com.
Forward-Looking Statements
Certain 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 DuraFit
sales projections, expected timing of test results, continued
progress in CDTi's transformation into an advanced materials
company while aggressively targeting near-term DuraFit revenue
opportunities, outlook for 2015, and anticipated benefits of
products and technologies. 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) meet expectations or
projections; (b) decrease costs; (c) increase sales; (d) obtain
adequate funding; (e) retain or secure customers; (f) increase its
customer base; (g) protect its intellectual property; (h)
successfully evolve into an advanced materials supplier or, even if
successful, increase profitability; (i) successfully market new
products; (j) obtain product verifications or approvals; (k)
attract or retain key personnel; or (l) 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. 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.
Clean Diesel
Technologies, Inc. |
Summary Statements of
Operations (unaudited) |
($
millions) |
|
|
3 Months
Ended |
|
March
31, |
|
2015 |
2014 |
Revenues |
$ 10.3 |
$ 11.6 |
Gross profit |
2.8 |
3.7 |
Gross margin |
27.3% |
32.3% |
|
|
|
Operating expenses: |
|
|
Selling, general and administrative |
3.4 |
3.6 |
Research and development |
2.1 |
1.3 |
Severance and other charges |
— |
0.3 |
Total operating expenses |
$ 5.5 |
$ 5.2 |
|
|
|
Loss from continuing operations |
$ (2.7) |
$ (1.5) |
Other expense |
0.2 |
2.1 |
Loss from continuing operations before income
tax |
(2.9) |
(3.6) |
Income tax expense from continuing
operations |
0.1 |
0.2 |
Net loss from continuing operations |
(3.0) |
(3.8) |
Discontinued operations |
— |
— |
Net loss |
$ (3.0) |
$ (3.8) |
|
|
|
Basic and diluted EPS |
$ (0.21) |
$ (0.39) |
Weighted shares outstanding (in
millions) |
14.2 |
9.8 |
|
|
|
Clean Diesel
Technologies, Inc. |
Segment
Information |
($
millions) |
|
|
3 Months
Ended |
|
March
31, |
|
2015 |
2014 |
Revenue |
|
|
Heavy Duty Diesel Systems |
$ 4.1 |
$ 6.3 |
Catalyst |
6.8 |
5.8 |
Eliminations |
(0.6) |
(0.5) |
Total |
$ 10.3 |
$ 11.6 |
|
|
|
(Loss) income from operations |
|
|
Heavy Duty Diesel Systems |
$ (0.4) |
$ 0.3 |
Catalyst |
(0.5) |
0.2 |
Corporate |
(1.7) |
(1.9) |
Eliminations |
(0.1) |
(0.1) |
Total |
$ (2.7) |
$ (1.5) |
|
|
|
Clean Diesel
Technologies, Inc. |
Summary Balance Sheets
(unaudited) |
($
millions) |
|
|
As
of |
|
March 31, 2015 |
December 31,
2014 |
Total current assets |
$ 15.6 |
$ 18.5 |
Total assets |
$ 24.8 |
$ 28.3 |
Total current liabilities |
$ 14.3 |
$ 13.5 |
Total long-term liabilities |
$ 7.8 |
$ 7.8 |
Stockholders' equity |
$ 2.7 |
$ 7.0 |
|
|
|
Short-term debt |
$ 3.1 |
$ 2.8 |
Long-term debt |
$ 7.5 |
$ 7.5 |
CONTACT: Becky Herrick or Cathy Mattison
LHA (IR Agency)
+1 415 433 3777
bherrick@lhai.com
cmattison@lhai.com
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