Superconductive Components, Inc. Reports Second Quarter Results
August 18 2004 - 6:18PM
PR Newswire (US)
Superconductive Components, Inc. Reports Second Quarter Results
COLUMBUS, Ohio, Aug. 18 /PRNewswire-FirstCall/ -- Superconductive
Components, Inc. (OTC:SCCI) (BULLETIN BOARD: SCCI) , a manufacturer
of advanced ceramics, optical materials, and high temperature
superconductive and non- superconductive products, today announced
results for the three months and six months ended June 30, 2004.
Total revenues increased 5.3% to $661,162 for the three months
ended June 30, 2004 compared to $627,765 for the same period last
year. The growth in second quarter 2004 revenues was principally
due to a 5.2% increase in product shipments. Contract research
revenue rose 6.5% for the second quarter 2004 from a year ago. This
was primarily due to a Phase II Department of Energy grant related
to development of an advanced method to manufacture continuous
reacted lengths of High Tc Superconductor wire. The loss applicable
to common shares was $357,249, or $0.17 per diluted share, for the
second quarter 2004 versus a net loss applicable to common shares
of $92,945, or $0.05 per diluted share, for the same period last
year. The second quarter 2004 results include a $175,362 non-cash
expense for the conversion of convertible promissory notes during
the quarter. Dan Rooney, Chairman, President and Chief Executive
Officer, commented, "Market conditions began to gradually improve
during the second quarter. Total revenues increased 29.7% on a
sequential quarter basis and were also above the same period last
year. Solid contributions to the second quarter revenues were
realized from focused marketing initiatives. We are working
diligently to improve our margins and also achieve sustained
revenue growth despite mixed signals from the economy at the end of
the second quarter." Mr. Rooney continued, "The market for lithium
thin film batteries is beginning to move beyond the prototype stage
as companies scale-up their operations to achieve increased
production capabilities. Sales to the Company's thin film battery
customers during the first half of 2004 surpassed the level
achieved during the entire year 2003. We plan to remain a leading
provider of materials for the emerging thin film battery market."
Gross margin declined to $130,627 for the second quarter 2004 from
$205,157 for the second quarter 2003. This was attributable to
product mix and lower gross margin on contract research revenue
compared to the same period in 2003. Contract research revenue for
the second quarter 2004 included higher costs related to a
Department of Energy Superconductivity Technology grant. General
and administrative expenses declined 2.3% to $231,744 for the
second quarter 2004 from $237,245 for the same period last year.
Sales and promotional expenses increased to $67,933 for the second
quarter 2004 from $49,318 for the same period a year ago. The
Company hired a sales manager in the first quarter 2004 to
strengthen and expand its marketing efforts, increase contact with
customers and add manufacturers' representatives. Six Month Results
Total revenues for the six months ended June 30, 2004 were
$1,170,939, or 8.9% below the same period in 2003. Product revenue
declined 11.0% to $1,056,644 for the first half of 2004 from
$1,187,153 a year ago. The revenue shortfall was attributable to
weak market conditions and lower product shipments related to the
Company's move to a new facility in the first quarter 2004. Gross
margin declined to $184,777 for the six months ended June 30, 2004
from $354,375 the prior year as a result of lower product revenues
and product mix. General and administrative expenses rose to
$493,000 for the first six months of 2004 from $416,315 for the
same period in 2003. Sales and promotional expenses increased to
$133,170 for the first half of 2004 from $97,574 for the same
period a year ago, primarily a result of the addition of a sales
manager in January 2004. Private Equity Placement and Debt
Conversion As previously disclosed, the Company received $620,000
in cash pursuant to its private equity placement during the second
quarter 2004. As of August 15, 2004, the Company has received
$720,200 through its private equity placement, which has resulted
in the issuance of 300,084 common shares and warrants to purchase
60,016 shares of common stock. The Company anticipates additional
funds will be received during the third quarter 2004. During the
second quarter 2004, $754,846 of principal and accrued interest due
on convertible promissory notes issued on June 30, 2003 was
converted into common stock in accordance with terms of the
convertible promissory notes. These notes were converted into
314,519 shares of common stock at a conversion price of $2.40 per
share. The holders of the convertible promissory notes also
received warrants to purchase 62,901 shares of the Company's common
stock, without par value, at a purchase price of $2.88 per share.
Pricing for the common stock and warrants was identical to the
terms of the Company's private equity placement. About
Superconductive Components, Inc. Superconductive Components, Inc.
operates through SCI Engineered Materials and manufactures advanced
ceramics such as superconductors, ferroelectric and optical
materials for use in wire, cable, batteries, wireless and fiber
optics systems. The Company also provides materials for thin film
applications used in photovoltaics, electronic switches, hardness
and decorative coatings. The company is a global materials supplier
with clients in more than 40 countries. Additional information is
available at http://www.sciengineeredmaterials.com/ . Safe Harbor
This press release contains certain forward-looking statements
within the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended, which are intended to be covered by the safe harbors
created thereby. Those statements include, but are not limited to,
all statements regarding intent, beliefs, expectations,
projections, forecasts, and plans of the company and its
management, and specifically include statements regarding market
conditions gradually improving during the second quarter and the
Company working diligently to improve margins and achieve sustained
sales growth (paragraph 4), the market for lithium thin film
batteries moving beyond the prototype stage and the Company's plans
to remain a leading provider of materials for the emerging thin
film battery market (paragraph 5), and the Company's anticipation
that additional funds from its private equity placement will be
received during the third quarter 2004 (paragraph 10). These
forward-looking statements involve numerous risks and
uncertainties, including, without limitation: the development of
the thin film battery market, the impact of competitive products
and services, the ability to adapt to technological changes, the
availability of capital, and other risks and uncertainties detailed
from time to time in the company's Securities and Exchange
Commission filings, including the company's Annual Report on Form
10-KSB for the year ended December 31, 2003. One or more of these
factors have affected, and could in the future affect, the
company's projections. Therefore, there can be no assurances that
the forward-looking statements included in this press release will
prove to be accurate. In light of the significant uncertainties in
the forward-looking statements included herein, the inclusion of
such information should not be regarded as a representation by the
Company, or any other persons, that the objectives and plans of the
Company will be achieved. All forward-looking statements made in
this press release are based on information presently available to
the management of the Company. The Company assumes no obligation to
update any forward-looking statements. DATASOURCE: Superconductive
Components, Inc. CONTACT: Robert Lentz of Robert A. Lentz
Associates, +1-614-876-2000 Web site:
http://www.sciengineeredmaterials.com/
Copyright