CC call notes.
Q: Have customers seen the Henderson line?
A: Previously shipped batteries to 2 major potential customers (10's of units)
A: found satisfactory, incomplete tests
A: latest batteries better in several ways
A: new batteries to be shipped to number (~12) additional potential customers
Q: When pilot production?
A: focus now on getting customers POs
A: NI production expected to meet demand, Henderson has same equipment as NI
A: don't expect major problems moving production to NI
A: some problems and glitches are expected but expected they can be solved
A: capability to make batteries in three weeks in three weeks
A: volume production in NI ... couple of months
A: sufficient capacity to produce test batteries in Henderson
A: critical path is marketing: interest, test, build in
A: get purchase orders (again)
A: no great demand for batteries for several months
A: key problem in past was attempt to develop without producing large quantities
A: Lev directed the company to start making batteries ... lots of batteries
A: now producing "a lot of batteries"
Q: Korea?
A: As of yesterday ... on plan, factory bldg completed late june, production 5 months
Q: Projection volume?
A: determined by customer pull ... company had lots of production capacity
A: large and small batteries volume next year ... assembly machine may cause problems
Q: OEM Feedback on volume estimate?
A: no real volume estimates
Q: Royalties: any from Delphi?
A: 3% up to $30M ... receiving $2.5M from Delphi next 90 days
Q: current cash position, how finance?
A: sufficient cash for 2 months (?), looking for debt financing
A: $17M last number the company revealed
Q: What is your current cash position? (question repeated)
A: $17M is the last number revealed
Observation: [analysts seem favorable in general]
Q: compare to competition e.g. ULBI
A: Lev: don't know ULBI product. Know our product.
Q: Acer has invested in LI development, how affect Acer as customer
A: Lev: don't know, never named Acer as potential customer
Q: how long customer to test, orders, ... what sales cycle? 2mo, 6mo, year?
A: some months, some customers closer than others
Q: computer batt, or phone?
A: initial 4x4x4mm 4x5x4mm computer batteries
A: costs inherently lower, electronics more efficiency, energy density higher
A: comm market ... no overwhelming advantages
A: target large batteries first, small second
A: confident machinery will work
A: 500 batteries/day in henderson
A: critical path is customer adoption ... mfg can fulfill demand
Q: names of customers?
A: Lev: decline to name
A: no names until large PO with scheduled delivery
Q: payback from NI
A: when company ships $4M ... worth about $7.5M from NI
Q: burnrate
A: burnrate is up from $1M due to production costs
Q: accounting issues? how write off previous R&D capital cost
A: reserves set up ... still exist on books about $18M
Q: end of Delphi contract? what affect on cost?
A: yes. contract complete. cash payment. $2.5M to be paid
A: on annual basis Delphi paid $2.5M in past
A: $2.5M to be paid = about one year of previous Delphi participation
Q: Delphi still enthused?
A: Delphi announcement of intentions stands
Q: indication of improvements in battery?
A: have been significant ... virtually every area
Q: What size batts are you going to make?
A: going to make 4 sizes of batteries, tooled for 4 sizes
A: 8x10xwhatever ... experience in making large batteries viz Delphi
A: small cellular batteries
Q: How many OEMs have sampled?
A: 2 OEMs ... total number of manufacturers sampled? total OEMs?
A: around a dozen |
