AMSC (NASDAQ:AMSC), a global solutions provider serving wind and
power grid industry leaders, today reported financial results for
its fourth quarter and full year fiscal 2016 ended March 31,
2017.
Revenues for the fourth quarter of fiscal 2016 were
$16.2 million, compared with $27.5 million for the same period of
fiscal 2015. The year-over-year decrease was largely due to lower
Wind segment revenues, primarily due to lower than expected
shipments of electric control systems to Inox during the fourth
quarter of fiscal 2016.
AMSC’s net loss for the fourth quarter of fiscal
2016 increased to $6.9 million, or $0.50 per share, from $3.4
million, or $0.25 per share, for the same period of fiscal 2015.
The Company’s non-GAAP net loss for the fourth quarter of fiscal
2016 was $7.1 million, or $0.51 per share, which increased compared
with a non-GAAP net loss of $3.8 million or $0.28 per share, in the
same period of fiscal 2015. Please refer to the financial table
below for a reconciliation of GAAP to non-GAAP results.
Revenues for the full fiscal year 2016 were $75.2
million as compared to $96.0 million in fiscal year 2015. AMSC
reported a net loss for fiscal 2016 of $27.4 million, or $1.98 per
share, compared to a net loss of $23.1 million, or $1.76 per share
in fiscal 2015. The Company's non-GAAP net loss for full year
fiscal 2016 was $27.0 million, or $1.95 per share, compared with a
non-GAAP net loss of $26.2 million, or $1.99 per share, for fiscal
2015.
Cash, cash equivalents and restricted cash at
March 31, 2017 totaled $27.7 million, compared with $26.0
million at December 31, 2016.
“Our grid business grew this year for the second
year in a row. We have been able to make progress in our grid
business. We grew D-VAR revenues year to year. We are diversifying
our product lineup by introducing a new offering for our grid
business. We announced the fourth and fifth cities that are
publicly working on a deployment study for our resilient electric
grid solution. We are preparing for anticipated insertion of our
ship protection systems into the U.S. Navy's surface fleet with a
services contract from the U.S. Navy, while continuing to make
progress on our second ship protection solution for the U.S. Navy,”
said Daniel P. McGahn, President and Chief Executive Officer of
AMSC. “We believe we will continue to further diversify our
business with additional orders in fiscal 2017.”
Business OutlookFor the first
quarter ending June 30, 2017, AMSC currently expects that its
revenues will be in the range of $8 million to $9 million, taking
into account anticipated seasonally lower ECS shipments to Inox as
well as the temporary demand dislocation previously discussed in
our preliminary fourth quarter financial results announced on April
26, 2017. The Company’s net loss for the first quarter of fiscal
2017 is expected to be less than $18.0 million, or $1.05 per
share. The Company’s expected net loss in the first quarter
of fiscal 2017 includes approximately $2.0 million in restructuring
charges associated with the actions announced on April 4,
2017. The Company's non-GAAP net loss (as defined below) is
expected to be less than $17.5 million, or $1.02 per share.
Excluding the proceeds from the recent equity offering, the Company
expects a cash burn of $7 million to $8 million in the first
quarter of fiscal 2017.
Conference Call ReminderIn
conjunction with this announcement, AMSC management will
participate in a conference call with investors beginning at 10:00
a.m. Eastern Time today to discuss the Company’s financial results
and business outlook. Those who wish to listen to the live or
archived conference call webcast should visit the “Investors”
section of the Company’s website at http://www.amsc.com/investors.
The live call also can be accessed by dialing 800-905-0392 and
using conference ID 8247681.
About AMSC (NASDAQ:AMSC)AMSC generates the ideas,
technologies and solutions that meet the world’s demand for
smarter, cleaner … better energy™. Through its Windtec™ Solutions,
AMSC provides wind turbine electronic controls and systems, designs
and engineering services that reduce the cost of wind energy.
Through its Gridtec™ Solutions, AMSC provides the engineering
planning services and advanced grid systems that optimize network
reliability, efficiency and performance. The Company’s solutions
are now powering gigawatts of renewable energy globally and are
enhancing the performance and reliability of power networks in more
than a dozen countries. Founded in 1987, AMSC is headquartered near
Boston, Massachusetts with operations in Asia, Australia, Europe
and North America. For more information, please visit
www.amsc.com.
AMSC, Windtec, Gridtec, and Smarter, Cleaner …
Better Energy are trademarks or registered trademarks of American
Superconductor Corporation. All other brand names, product names,
trademarks or service marks belong to their respective holders.
Forward-Looking Statements
This press release contains forward-looking
statements within the meaning of Section 21E of the Securities
Exchange Act of 1934, as amended (the "Exchange Act"). Any
statements in this release about our anticipated insertion of our
ship protection systems into the U.S. Navy's surface fleet, our
belief that we will continue to further diversify our business with
additional orders in fiscal 2017, our anticipated financial results
for the quarter ending June 30, 2017, our anticipated cash burn
during the quarter ending June 30, 2017 and other statements
containing the words "believes," "anticipates," "plans," "expects,"
"will" and similar expressions, constitute forward-looking
statements within the meaning of the Private Securities Litigation
Reform Act of 1995. Such forward-looking statements represent
management's current expectations and are inherently uncertain.
There are a number of important factors that could materially
impact the value of our common stock or cause actual results to
differ materially from those indicated by such forward-looking
statements. These important factors include, but are not limited
to: A significant portion of our revenues are derived from a single
customer, Inox; We have a history of operating losses and negative
operating cash flows, which may continue in the future and require
us to secure additional financing in the future; Our operating
results may fluctuate significantly from quarter to quarter and may
fall below expectations in any particular fiscal quarter; Our
financial condition may have an adverse effect on our customer and
supplier relationships; Our success in addressing the wind energy
market is dependent on the manufacturers that license our designs;
Our success is dependent upon attracting and retaining qualified
personnel and our inability to do so could significantly damage our
business and prospects; We rely upon third-party suppliers for the
components and sub-assemblies of many of our Wind and Grid
products, making us vulnerable to supply shortages and price
fluctuations; Failure to successfully execute any move of our
Devens, Massachusetts manufacturing facility or achieve expected
savings following any move could adversely impact our financial
performance; We may not realize all of the sales expected from our
backlog of orders and contracts; Our success depends upon the
commercial use of high temperature superconductor products, which
is currently limited, and a widespread commercial market for our
products may not develop; Growth of the wind energy market depends
largely on the availability and size of government subsidies,
economic incentives and legislative programs designed to support
the growth of wind energy; We have operations in and depend on
sales in emerging markets, including India, and global conditions
could negatively affect our operating results or limit our ability
to expand our operations outside of these markets; We face risks
related to our intellectual property; We face risks related to our
legal proceedings; and the important factors discussed under the
caption "Risk Factors" in Part 1. Item 1A of our Form 10-K for the
fiscal year ended March 31, 2017, and our other reports filed with
the SEC. These important factors, among others, could cause actual
results to differ materially from those indicated by
forward-looking statements made herein and presented elsewhere by
management from time to time. Any such forward-looking statements
represent management's estimates as of the date of this press
release. While we may elect to update such forward-looking
statements at some point in the future, we disclaim any obligation
to do so, even if subsequent events cause our views to change.
These forward-looking statements should not be relied upon as
representing our views as of any date subsequent to the date of
this press release.
UNAUDITED CONSOLIDATED STATEMENTS OF
OPERATIONS |
(In thousands, except per share
data) |
|
|
Three months ended March 31, |
|
Twelve months ended March 31, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Revenues |
|
|
|
|
|
|
|
Wind |
$ |
10,447 |
|
|
$ |
19,907 |
|
|
$ |
47,269 |
|
|
$ |
68,883 |
|
Grid |
5,748 |
|
|
7,618 |
|
|
27,926 |
|
|
27,140 |
|
Revenues |
16,195 |
|
|
27,525 |
|
|
75,195 |
|
|
96,023 |
|
|
|
|
|
|
|
|
|
Cost of revenues |
13,360 |
|
|
18,284 |
|
|
64,352 |
|
|
74,041 |
|
|
|
|
|
|
|
|
|
Gross profit |
2,835 |
|
|
9,241 |
|
|
10,843 |
|
|
21,982 |
|
|
|
|
|
|
|
|
|
Operating
expenses: |
|
|
|
|
|
|
|
Research
and development |
3,736 |
|
|
3,379 |
|
|
12,540 |
|
|
12,303 |
|
Selling,
general and administrative |
6,048 |
|
|
7,530 |
|
|
25,688 |
|
|
28,861 |
|
Restructuring and impairments |
— |
|
|
— |
|
|
— |
|
|
779 |
|
Amortization of acquisition related intangibles |
39 |
|
|
39 |
|
|
157 |
|
|
157 |
|
Total
operating expenses |
9,823 |
|
|
10,948 |
|
|
38,385 |
|
|
42,100 |
|
|
|
|
|
|
|
|
|
Operating loss |
(6,988 |
) |
|
(1,707 |
) |
|
(27,542 |
) |
|
(20,118 |
) |
|
|
|
|
|
|
|
|
Change in fair value of
derivatives and warrants |
636 |
|
|
(637 |
) |
|
1,304 |
|
|
(228 |
) |
Gain on sale of
minority interests |
— |
|
|
581 |
|
|
325 |
|
|
3,092 |
|
Interest expense,
net |
(52 |
) |
|
(196 |
) |
|
(383 |
) |
|
(1,037 |
) |
Other income (expense),
net |
(415 |
) |
|
(1,268 |
) |
|
65 |
|
|
(2,457 |
) |
|
|
|
|
|
|
|
|
Loss before income tax
expense |
(6,819 |
) |
|
(3,227 |
) |
|
(26,231 |
) |
|
(20,748 |
) |
|
|
|
|
|
|
|
|
Income tax expense |
106 |
|
|
135 |
|
|
1,142 |
|
|
2,391 |
|
|
|
|
|
|
|
|
|
Net loss |
$ |
(6,925 |
) |
|
$ |
(3,362 |
) |
|
$ |
(27,373 |
) |
|
$ |
(23,139 |
) |
|
|
|
|
|
|
|
|
Net loss per common
share |
|
|
|
|
|
|
|
Basic |
$ |
(0.50 |
) |
|
$ |
(0.25 |
) |
|
$ |
(1.98 |
) |
|
$ |
(1.76 |
) |
Diluted |
$ |
(0.50 |
) |
|
$ |
(0.25 |
) |
|
$ |
(1.98 |
) |
|
$ |
(1.76 |
) |
|
|
|
|
|
|
|
|
Weighted average number
of common shares outstanding |
|
|
|
|
|
|
|
Basic |
13,981 |
|
|
13,559 |
|
|
13,804 |
|
|
13,178 |
|
Diluted |
13,981 |
|
|
13,559 |
|
|
13,804 |
|
|
13,178 |
|
CONSOLIDATED BALANCE SHEET |
(In thousands, except per share
data) |
|
|
March 31, 2017 |
|
March 31, 2016 |
ASSETS |
|
|
|
Current assets: |
|
|
|
Cash and
cash equivalents |
$ |
26,784 |
|
|
$ |
39,330 |
|
Accounts
receivable, net |
7,956 |
|
|
19,264 |
|
Inventory |
17,462 |
|
|
18,512 |
|
Prepaid
expenses and other current assets |
2,703 |
|
|
5,778 |
|
Restricted cash |
795 |
|
|
457 |
|
Total
current assets |
55,700 |
|
|
83,341 |
|
|
|
|
|
Property,
plant and equipment, net |
43,438 |
|
|
49,778 |
|
Intangibles, net |
301 |
|
|
854 |
|
Restricted cash |
165 |
|
|
934 |
|
Deferred
tax assets |
407 |
|
|
96 |
|
Other
assets |
233 |
|
|
315 |
|
|
|
|
|
Total
assets |
$ |
100,244 |
|
|
$ |
135,318 |
|
|
|
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS' EQUITY |
|
|
|
|
|
|
|
Current
liabilities: |
|
|
|
Accounts
payable and accrued expenses |
14,490 |
|
|
23,156 |
|
Note
payable, current portion, net of discount of $19 as of March 31,
2017 and $42 as of March 31, 2016 |
1,481 |
|
|
2,624 |
|
Derivative liabilities |
1,923 |
|
|
3,227 |
|
Deferred
revenue |
14,323 |
|
|
12,000 |
|
Total
current liabilities |
32,217 |
|
|
41,007 |
|
|
|
|
|
Note
payable, net of discount of $133 as of March 31, 2016 |
— |
|
|
1,367 |
|
Deferred
revenue |
7,631 |
|
|
9,269 |
|
Deferred
tax liabilities |
125 |
|
|
63 |
|
Other
liabilities |
45 |
|
|
63 |
|
Total
liabilities |
40,018 |
|
|
51,769 |
|
|
|
|
|
Stockholders'
equity: |
|
|
|
Common
stock, $0.01 par value, 75,000,000 shares authorized; 14,713,839
and 14,107,126 shares issued at March 31, 2017 and 2016,
respectively |
147 |
|
|
141 |
|
Additional paid-in capital |
1,017,510 |
|
|
1,011,813 |
|
Treasury
stock, at cost, 97,529 and 51,506 shares at March 31, 2017 and
2016, respectively |
(1,371 |
) |
|
(881 |
) |
Accumulated other comprehensive (loss) income |
(503 |
) |
|
660 |
|
Accumulated deficit |
(955,557 |
) |
|
(928,184 |
) |
Total
stockholders' equity |
60,226 |
|
|
83,549 |
|
|
|
|
|
Total
liabilities and stockholders' equity |
$ |
100,244 |
|
|
$ |
135,318 |
|
CONSOLIDATED STATEMENTS OF CASH
FLOWS |
(In thousands) |
|
|
Twelve months ended March 31, |
|
2017 |
|
2016 |
Cash flows from
operating activities: |
|
|
|
|
|
|
|
Net
loss |
$ |
(27,373 |
) |
|
$ |
(23,139 |
) |
Adjustments to reconcile net loss to net cash used in
operations: |
|
|
|
Depreciation and amortization |
7,519 |
|
|
7,972 |
|
Stock-based compensation expense |
2,892 |
|
|
3,248 |
|
Impairment of minority interest investments |
— |
|
|
746 |
|
Provision
for excess and obsolete inventory |
1,615 |
|
|
2,713 |
|
Write-off
prepaid taxes |
— |
|
|
289 |
|
Gain on
sale from minority interest investments |
(325 |
) |
|
(3,092 |
) |
Loss from
minority interest investments |
— |
|
|
356 |
|
Change in
fair value of derivatives and warrants |
(1,304 |
) |
|
228 |
|
Non-cash
interest expense |
156 |
|
|
359 |
|
Other
non-cash items |
(940 |
) |
|
1,462 |
|
Changes in operating
asset and liability accounts: |
|
|
|
Accounts
receivable |
11,143 |
|
|
(9,318 |
) |
Inventory |
(815 |
) |
|
(782 |
) |
Prepaid
expenses and other current assets |
2,729 |
|
|
5,608 |
|
Accounts
payable and accrued expenses |
(7,938 |
) |
|
1,543 |
|
Deferred
revenue |
1,426 |
|
|
7,248 |
|
Net cash
used in operating activities |
(11,215 |
) |
|
(4,559 |
) |
|
|
|
|
Cash flows from
investing activities: |
|
|
|
Net cash
provided by investing activities |
192 |
|
|
4,873 |
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
Net cash
(used in) provided by financing activities |
(1,130 |
) |
|
18,202 |
|
|
|
|
|
Effect of exchange rate
changes on cash and cash equivalents |
(393 |
) |
|
324 |
|
|
|
|
|
Net (decrease)/increase
in cash and cash equivalents |
(12,546 |
) |
|
18,840 |
|
Cash and cash
equivalents at beginning of year |
39,330 |
|
|
20,490 |
|
Cash and cash
equivalents at end of year |
$ |
26,784 |
|
|
$ |
39,330 |
|
RECONCILIATION OF GAAP NET INCOME (LOSS) TO
NON-GAAP NET INCOME (LOSS) |
(In thousands, except per share
data) |
|
|
Three months ended March 31, |
|
Twelve months ended March 31, |
|
2017 |
|
2016 |
|
2017 |
|
2016 |
Net loss |
$ |
(6,925 |
) |
|
$ |
(3,362 |
) |
|
$ |
(27,373 |
) |
|
$ |
(23,139 |
) |
Gain on sale of
interest in minority investments, net of tax effect |
— |
|
|
(565 |
) |
|
(325 |
) |
|
(2,919 |
) |
Stock-based
compensation |
626 |
|
|
706 |
|
|
2,892 |
|
|
3,248 |
|
Amortization of
acquisition-related intangibles |
39 |
|
|
39 |
|
|
157 |
|
|
157 |
|
Restructuring and
impairment charges |
— |
|
|
— |
|
|
— |
|
|
779 |
|
Consumption of zero
cost-basis inventory |
(254 |
) |
|
(1,348 |
) |
|
(1,373 |
) |
|
(4,960 |
) |
Change in fair value of
derivatives and warrants |
(636 |
) |
|
637 |
|
|
(1,304 |
) |
|
228 |
|
Non-cash interest
expense |
28 |
|
|
$ |
69 |
|
|
156 |
|
|
359 |
|
Tax effect of
adjustments |
41 |
|
|
— |
|
|
220 |
|
|
— |
|
Non-GAAP net loss |
$ |
(7,081 |
) |
|
$ |
(3,824 |
) |
|
$ |
(26,950 |
) |
|
$ |
(26,247 |
) |
|
|
|
|
|
|
|
|
Non-GAAP net loss per
share |
$ |
(0.51 |
) |
|
$ |
(0.28 |
) |
|
$ |
(1.95 |
) |
|
$ |
(1.99 |
) |
Weighted average shares
outstanding - basic and diluted |
13,981 |
|
|
13,559 |
|
|
13,804 |
|
|
13,178 |
|
Reconciliation of Forecast GAAP Net Loss to
Non-GAAP Net Loss |
(In millions, except per share
data) |
|
|
Three months ending |
|
June 30, 2017 |
|
Net loss |
$ |
(18.0 |
) |
|
Stock-based
compensation |
|
0.7 |
|
|
Consumption of
zero-cost inventory |
|
(0.2 |
) |
|
Non-GAAP net loss |
$ |
(17.5 |
) |
|
Non-GAAP net loss per
share |
$ |
(1.02 |
) |
|
Shares outstanding |
|
17.1 |
|
|
Note: Non-GAAP net loss is defined by the Company
as net loss before stock-based compensation; restructuring and
impairment charges; amortization of acquisition-related
intangibles; consumption of zero cost-basis inventory; non-cash
interest expense; change in fair value of derivatives and warrants;
and other unusual charges, net of any tax effects related to these
items. The Company believes non-GAAP net loss assists management
and investors in comparing the Company’s performance across
reporting periods on a consistent basis by excluding these
non-cash, non-recurring or other charges that it does not believe
are indicative of its core operating performance. The Company also
regards non-GAAP net loss as a useful measure of operating
performance to complement operating loss, net loss and other GAAP
financial performance measures. In addition, the Company uses
non-GAAP net loss as a factor in evaluating management’s
performance when determining incentive compensation and to evaluate
the effectiveness of its business strategies.
Generally, a non-GAAP financial measure is a
numerical measure of a company's performance, financial position or
cash flow that either excludes or includes amounts that are not
normally excluded or included in the most directly comparable
measure calculated and presented in accordance with GAAP. The
non-GAAP measures included in this release, however, should be
considered in addition to, and not as a substitute for or superior
to, operating income, cash flows, or other measures of financial
performance prepared in accordance with GAAP. A reconciliation of
non-GAAP to GAAP net loss is set forth in the table above.
AMSC Contact:
Brion D. Tanous
AMSC Investor Relations
Phone: 424-634-8592
Email: Brion.Tanous@amsc.com
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