Management to Host Conference Call Today at
10:30 a.m. ET
Ideal Power Inc. (NASDAQ: IPWR), an innovative power conversion
technology company, reported results for the three and nine months
ended September 30, 2018.
Key Third Quarter 2018 and Subsequent Notable
Events:
Power Conversion Systems Division
- We ’ve been approached by and are engaged in discussions with
entities in the renewable energy space regarding a strategic
combination of our PPSA™ technology into a more integrated platform
with broader market reach.
- Installed two-megawatts of our SunDial™ Plus inverters for a
large-scale deployment by Brantingham & Carroll International
Ltd. (BCI) of an advanced solar + storage solution in China. The
array is currently being commissioned and represents the largest
installation in company history.
- Shipped 1.5 megawatts of our Stabiliti™ power conversion
systems and SunDial™ Plus inverters to customers deploying
standalone energy storage, electric vehicle fast charging and solar
+ storage systems.
- Sales were lower in the quarter due to a customer requested
rescheduling of a large shipment of SunDial Plus™ units until late
October as well as supply chain delays caused by extended lead
times for electronic components.
B-TRAN™ Division
- Completed production of double-sided wafers of B-TRAN die that
will undergo testing in the coming weeks.
- Initiated fabrication of our second generation die at a
commercial domestic foundry. These wafers incorporate the learning
from earlier units produced at a prototype production
facility.
- Identified several government funding opportunities for device
specific development and B-TRAN based demonstration projects. We’ve
partnered with the University of Texas and a domestic government
contractor to respond to these opportunities.
- Engineering samples for potential customers and partners on
track for delivery in Q4 2018/Q1 2019.
Management Commentary
"Although challenging, the third quarter of 2018 was highlighted
by continued purchase orders in the standalone storage and
microgrid applications with our 30 kW Stabiliti™ Series power
conversion system,” said Dr. Lon Bell, Chief Executive Officer of
Ideal Power. “We are also happy to report that our largest
installation in company history with BCI in China is now being
commissioned and creates the opportunity for additional solar plus
storage installations in China.
“Most importantly, as part of a new strategic direction for our
PPSA technology, we have entered into several strategic discussions
for utilization of our PPSA technology as a fully integrated
technology offering for large commercial companies in the United
States. We believe the level of interest is encouraging and look
forward to communicating additional details over the next several
months,” concluded Bell.
“Our commercial timeline for our B-TRAN technology remains on
track and during the third quarter we produced wafers at a
prototype facility which will be tested in the coming weeks. We
also began production of wafers at a commercial domestic
semiconductor fabricator incorporating manufacturing improvements
from the prototype devices. Shortly, we will be able to evaluate a
variety of device configurations enabling us to explore variations
in the B-TRAN design and assess their manufacturability and impact
on device performance,” stated Dan Brdar, B-TRAN Chief Commercial
Officer.
“Conversations with potential customers and partners for our
solid-state switch technology remain strong and we plan to deliver
engineering samples within the next 18 weeks,” concluded Brdar.
Third Quarter 2018 Financial Results
- Q3 2018 revenue totaled $0.3 million versus $0.4 million in Q3
2017. Revenue for the nine months ended September 30, 2018
totaled $1.1 million compared to $1.0 million in the same period of
the prior year.
- Q3 2018 gross margins were negative 61% compared to positive 6%
in Q3 2017. Gross margins were impacted by an unfavorable
adjustment to the Company’s product warranty accrual, higher
component costs and a write-off of legacy product finished
goods.
- Q3 2018 operating expenses were $0.2 million lower than in Q3
2017 due to the impact of cost reduction activities.
- Q3 2018 net loss was $2.2 million, flat compared to Q3
2017.
- Q3 2018 cash used in operating activities was $1.4 million
compared to $1.6 million in Q3 2017. Cash used in operating
activities for the nine months ended September 30, 2018 was $4.3
million compared to $5.9 million in the nine months ended September
30, 2017.
- Cash and cash equivalents totaled $5.5 million as of September
30, 2018, with no long-term debt outstanding.
“Product revenue in the third quarter of 2018 was impacted by a
customer requested delay in shipment of 1-megawatt of our SunDial™
Plus product from Q3 to October 2018,” said Tim Burns, Chief
Financial Officer. “On the cash management side, we maintained our
targeted quarterly cash burn rate, utilizing $1.4 million of cash
in the quarter, due to aggressive cost cutting initiatives. We
believe that strong cash management, our potential new PPSA
strategic alternatives and no debt will provide Ideal Power with a
stable financial runway into 2019,” concluded Burns.
Conference Call Details
Ideal Power Chairman, CEO and President Dr. Lon Bell, CFO Tim
Burns and B-TRAN Chief Commercial Officer Dan Brdar will host the
conference call, followed by a question and answer period.
To access the call, please use the following information:
Date: |
Thursday, November 15,
2018 |
Time: |
10:30 a.m. ET, 7:30
a.m. PT |
Toll-free dial-in
number: |
1-888-254-3590 |
International dial-in
number: |
1-323-994-2093 |
Conference ID: |
8294881 |
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=132216 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 1:30
p.m. Eastern time through December 15, 2018.
Toll Free Replay
Number: |
1-844-512-2921 |
International Replay
Number: |
1-412-317-6671 |
Replay ID: |
8294881 |
About Ideal Power Inc.Ideal
Power (NASDAQ: IPWR) is a power conversion technology company that
delivers innovative solutions to system integrators and project
developers enabling distributed energy resources for applications
both on and off the grid. Ideal Power’s products deliver
reliability and compelling return on investment for renewable
energy and storage 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 + storage, battery energy storage, electric vehicle
charging and microgrids.
Ideal Power’s patented Bi-directional Bi-polar
Junction Transistor (B-TRAN) semiconductor technology is a unique
double-sided bi-directional AC switch expected to deliver
substantial performance improvements over today's conventional
power semiconductors. B-TRANs offer the potential to improve
efficiency and system economics of a wide variety of power
converter applications including electrified vehicle traction
drives, energy storage applications, photovoltaic (PV) inverters
and wind converters, variable frequency (VFD) motor drives, and AC
and DC power control applications. 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. 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, the success of potential PPSA strategic alternatives,
market acceptance of our products in the solar + storage market,
the success of our B-TRAN technology, the success of our corporate
reorganization and management changes, 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, 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 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, whether our cost
reduction efforts will continue to be successful and other risks,
whether we can continue as a going concern 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 in the
past, 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 Investor Relations
Contact: MZ North America Chris Tyson
949-491-8235 IPWR@mzgroup.us www.mzgroup.us
IDEAL POWER INC. Balance
Sheets
|
|
September 30, 2018 |
|
December 31, 2017 |
|
|
(unaudited) |
|
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
|
Cash and
cash equivalents |
|
$ |
5,538,765 |
|
|
$ |
10,022,247 |
|
|
Accounts
receivable, net |
|
279,299 |
|
|
221,084 |
|
|
Inventories, net |
|
131,765 |
|
|
251,363 |
|
|
Prepayments and other current assets |
|
83,382 |
|
|
283,208 |
|
|
Total
current assets |
|
6,033,211 |
|
|
10,777,902 |
|
|
|
|
|
|
|
|
Property and equipment,
net |
|
458,856 |
|
|
669,571 |
|
|
Intangible assets,
net |
|
2,109,981 |
|
|
2,082,014 |
|
|
Other assets |
|
55,420 |
|
|
37,500 |
|
|
Total
Assets |
|
$ |
8,657,468 |
|
|
$ |
13,566,987 |
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
|
Current
liabilities: |
|
|
|
|
|
Accounts
payable |
|
$ |
737,083 |
|
|
$ |
449,475 |
|
|
Accrued
expenses |
|
1,068,418 |
|
|
1,081,155 |
|
|
Total
current liabilities |
|
1,805,501 |
|
|
1,530,630 |
|
|
|
|
|
|
|
|
Other long-term
liabilities |
|
465,181 |
|
|
456,234 |
|
|
Total
liabilities |
|
2,270,682 |
|
|
1,986,864 |
|
|
|
|
|
|
|
|
Commitments and
contingencies (see Note 8) |
|
|
|
|
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
|
|
Preferred
stock, $0.001 par value; 10,000,000 shares authorized; 1,518,430
shares issued and outstanding at September 30, 2018 and December
31, 2017, respectively |
|
1,518 |
|
|
1,518 |
|
|
Common
stock, $0.001 par value; 50,000,000 shares authorized; 14,004,465
shares issued and 13,999,756 shares outstanding at September 30,
2018 and 13,998,465 shares issued and 13,996,121 shares outstanding
at December 31, 2017, respectively |
|
14,004 |
|
|
13,998 |
|
|
Additional paid-in capital |
|
67,919,163 |
|
|
67,081,359 |
|
|
Treasury
stock, at cost; 4,709 shares at September 30, 2018 and 2,344 shares
at December 31, 2017 |
|
(10,105 |
) |
|
(7,489 |
) |
|
Accumulated deficit |
|
(61,537,794 |
) |
|
(55,509,263 |
) |
|
Total
stockholders’ equity |
|
6,386,786 |
|
|
11,580,123 |
|
|
Total
Liabilities and Stockholders’ Equity |
|
$ |
8,657,468 |
|
|
$ |
13,566,987 |
|
|
IDEAL POWER INC.
Statements of Operations
(unaudited)
|
|
Three Months Ended September 30, |
|
Nine Months Ended September 30, |
|
|
2018 |
|
2017 |
|
2018 |
|
2017 |
Product revenue |
|
$ |
342,661 |
|
|
$ |
444,640 |
|
|
$ |
1,144,103 |
|
|
$ |
973,680 |
|
Cost of product
revenue |
|
552,127 |
|
|
418,529 |
|
|
1,471,890 |
|
|
1,894,068 |
|
Gross
profit (loss) |
|
(209,466 |
) |
|
26,111 |
|
|
(327,787 |
) |
|
(920,388 |
) |
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
|
Research
and development |
|
854,364 |
|
|
1,075,849 |
|
|
2,517,688 |
|
|
3,374,386 |
|
General
and administrative |
|
921,276 |
|
|
899,882 |
|
|
2,630,936 |
|
|
2,976,260 |
|
Sales and
marketing |
|
264,705 |
|
|
271,844 |
|
|
588,937 |
|
|
1,240,713 |
|
Total
operating expenses |
|
2,040,345 |
|
|
2,247,575 |
|
|
5,737,561 |
|
|
7,591,359 |
|
|
|
|
|
|
|
|
|
|
Loss from
operations |
|
(2,249,811 |
) |
|
(2,221,464 |
) |
|
(6,065,348 |
) |
|
(8,511,747 |
) |
|
|
|
|
|
|
|
|
|
Interest income
(expense), net |
|
(112 |
|
|
3,865 |
|
|
36,817 |
|
|
15,440 |
|
|
|
|
|
|
|
|
|
|
Net loss |
|
$ |
(2,249,923 |
) |
|
$ |
(2,217,599 |
) |
|
$ |
(6,028,531 |
) |
|
$ |
(8,496,307 |
) |
|
|
|
|
|
|
|
|
|
Net loss per share –
basic and fully diluted |
|
$ |
(0.16 |
) |
|
$ |
(0.16 |
) |
|
$ |
(0.43 |
) |
|
$ |
(0.66 |
) |
|
|
|
|
|
|
|
|
|
Weighted average number
of shares outstanding – basic and fully diluted |
|
13,996,299 |
|
|
13,990,202 |
|
|
13,993,423 |
|
|
12,964,452 |
|
IDEAL POWER INC. Statements of Cash Flows
(unaudited)
|
|
Nine Months Ended September 30, |
|
|
|
2018 |
|
2017 |
|
Cash flows from
operating activities: |
|
|
|
|
|
Net
loss |
|
$ |
(6,028,531 |
) |
|
$ |
(8,496,307 |
) |
|
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
|
Allowance
for doubtful accounts |
|
(98,677 |
|
|
226,557 |
|
|
Write-down of inventory |
|
67,515 |
|
|
703,220 |
|
|
Depreciation and amortization |
|
297,007 |
|
|
339,493 |
|
|
Write-off
of capitalized patents |
|
15,478 |
|
|
268,789 |
|
|
Write-off
of fixed assets |
|
7,128 |
|
|
53,445 |
|
|
Stock-based compensation |
|
837,810 |
|
|
833,637 |
|
|
Decrease
(increase) in operating assets: |
|
|
|
|
|
Accounts
receivable |
|
40,462 |
|
|
(234,980 |
) |
|
Inventories |
|
52,083 |
|
|
214,466 |
|
|
Prepayments and other current assets |
|
181,906 |
|
|
159,366 |
|
|
Increase
(decrease) in operating liabilities: |
|
|
|
|
|
Accounts
payable |
|
287,608 |
|
|
(59,653 |
) |
|
Accrued
expenses |
|
(3,790 |
) |
|
67,722 |
|
|
Net cash
used in operating activities |
|
(4,344,001 |
) |
|
(5,924,245 |
) |
|
|
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
|
Purchase
of property and equipment |
|
(19,613 |
) |
|
(44,819 |
) |
|
Acquisition of intangible assets |
|
(117,252 |
) |
|
(220,865 |
) |
|
Net cash
used in investing activities |
|
(136,865 |
) |
|
(265,684 |
) |
|
|
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
|
Net
proceeds from issuance of stock |
|
- |
|
|
13,657,331 |
|
|
Payment
of taxes related to stock award vesting |
|
(2,616 |
) |
|
(1,574 |
) |
|
Exercise
of options and warrants |
|
- |
|
|
11,143 |
|
|
Net cash
provided by (used in) financing activities |
|
(2,616 |
) |
|
13,666,900 |
|
|
|
|
|
|
|
|
Net increase (decrease)
in cash and cash equivalents |
|
(4,483,482 |
) |
|
7,476,971 |
|
|
Cash and cash
equivalents at beginning of period |
|
10,022,247 |
|
|
4,204,916 |
|
|
Cash and cash
equivalents at end of period |
|
$ |
5,538,765 |
|
|
$ |
11,681,887 |
|
|
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