SatCon, a leader in power and energy management products targeting the distributed power generation and power quality markets, today announced financial results for the third quarter ended June 30, 2000. Revenue for the third quarter increased by $4.6 million, or 112%, to a record $8.7 million versus $4.1 million in the third quarter of 1999. Revenue for the first nine months of 2000 increased by $9.3 million, or 81%, to $20.8 million versus $11.5 million in 1999.
The net loss for the quarter was $2.6 million versus $7.8 million in the third quarter of 1999. The net loss per share attributable to common stockholders for the quarter was $.19 versus $.85 per share in the third quarter of 1999. Net loss for the first nine months of 2000 was $6.9 million versus $9.0 million for the prior year. The net loss per share attributable to common stockholders for the first nine months of 2000 was $.81 versus $.99 for the first nine months of 1999.
For the three and nine months ended September 30, 2000, the breakdown of revenue by operating segment is as follows:
(In $000's)
Three months ended Nine months ended
June 30, June 30,
2000 1999 2000 1999
Electronics Products $ 2,427 $ 2,059 $ 5,936 $ 4,548
Motion Control Products 3,018 563 8,256 1,841
Funded Research and Development 3,249 1,469 6,603 5,090
Total Revenue $ 8,694 $ 4,091 $20,795 $11,479
Third quarter revenue for the Electronics Products segment increased by $368,000, or 18%, to $2.4 million. In the Motion Control Products segment, third quarter revenues increased by $2.5 million, or 436% to $3.0 million. The inclusion of revenue from the Ling Electronics acquisition accounted for $1.7 million of this increase and Magmotor revenue increased by $800,000. Funded research and development revenue from the Technology Center increased by 121% or $1.8 million.
For the first nine months of 2000, revenue from the Electronics Products segment increased by $1.4 million, revenue from the Funded Research and Development segment increased by $1.5 million and revenue from the Motion Control segment increased by $6.4 million. The inclusion of revenue from Ling Electronics contributed $5.2 million to the increase in revenue in the Motion Control Products segment and Magmotor revenue increased by $1.2 million.
SatCon also announced changes to its financial statements for fiscal years 1996, 1997, 1998, 1999 and the quarter ended December 31, 1999. The restatement of SatCon's financial statements was prompted by the recently completed initial audit of the financial statements of Beacon Power Corporation and primarily reflects treating certain costs as expenses rather than being included in the value of the assets that SatCon had contributed to Beacon Power. SatCon had previously accounted for these costs either as fixed assets or as part of its initial investment in Beacon Power. There is no cumulative reduction in SatCon's stockholders' equity as of June 30, 2000, since SatCon had written off its investment in Beacon Power as of December 31, 1999. The effect of this change is to increase the reported net loss in fiscal years 1996 and 1997 and to decrease the reported net loss in fiscal years 1998 and 1999 and in the quarter ended December 31, 1999 as follows:
(In $000's)
Restated Reported Change
Net loss for year ended September 30, 1996 $ 3,789 $ 2,865 $ 924
Net loss for year ended September 30, 1997 7,709 6,143 1,566
Net loss for year ended September 30, 1998 3,274 4,306 (1,032)
Net loss for year ended September 30, 1999 11,082 12,410 (1,328)
Net loss for three months ended Dec 31, 1999 2,569 2,699 (130)
Cumulative effect of change on net loss $ 0
SatCon will amend its annual report filed on Form 10-K for the year ended September 30, 1999 and its quarterly 10-Q reports for the quarters ended December 31, 1999 and March 31, 2000 to reflect the above financial restatements.
David Eisenhaure, SatCon's President and Chief Executive Officer, said, "We were pleased to see our revenues more than double in the third quarter as compared to last year. We have been continuing our transition to a manufacturing based company and our revenue growth reflects this momentum. Revenue for the quarter increased over the prior year at each of our manufacturing divisions and we have also been able to increase contract research and development revenue which helps fund our investment in research and development."
"We were able to reduce our operating loss for the quarter from the prior year even though research and development expenses increased by $1.8 million," Eisenhaure continued. "We have continued to increase our investment in the development of our PowerGate(TM) power conversion electronics for fuel cells and have made excellent progress over the third quarter. We introduced GridLink,(TM) which is designed to enable any type of fuel cells equipped with our PowerGate(TM) power conversion system to interface with the utility grid and operate in either grid parallel (connected to the grid) and/or grid independent (disconnected from the grid) modes. We believe that this proprietary technology can solve many of the technical and regulatory hurdles facing fuel cells and we intend to offer standard PowerGate(TM) power conversion systems to all fuel cell companies based on an open architecture. "
"On the manufacturing front, our automated production line for power conversion electronics was successfully demonstrated for us at the manufacturer's facility in June. The equipment has been delivered to our Advanced Fuel Cell Power Products Division in Marlborough, Massachusetts, and we expect to be manufacturing limited quantities of product by the end of this year. We anticipate having the initial capability of manufacturing 25,000 PowerGate(TM) power converter systems per year and will expand our capacity as demand increases."
"At Magmotor, third quarter revenue increased by 134% over the same period in 1999. This is attributable to increased shipments to Applied Materials of our magnetic levitation motor systems for both 200mm and 300mm silicon wafer manufacturing. During the third quarter, we received an additional $2.0 million order from Applied Materials. There was also an increase in sales of our value-added motor product line, which are motors that we customize and modify with gearboxes, pulleys, harnesses and encoders. We sell these motors into the semiconductor and factory automation markets. We also realized the benefits of a national sales representative network that has increased our overall sales efforts."
"At FMI, sales increased in several product categories. First, we saw increases in sales of our RF satellite uplink amplifiers. FMI also signed on a new distributor for its standard product lines, which resulted in increases in sales of linear amplifiers and other standard products. We have increased sales in our RF microwave products and realized an increase in sales to Raytheon during the third quarter. "
"At the Technology Center, revenue from funded research and development increased by $1.8 million primarily as a result of work performed under the AIPM (Advanced Integrated Power Module) program with the Department of Energy to develop low cost power conversion modules for electric and hybrid electric automobiles. In addition, the Technology Center was focused on completing the development of production designs for our PowerGate(Tm) power conversion module for fuel cell and microturbine power generation systems."
"Our Beacon Power affiliate announced significant news this past quarter by raising $28.5 million in a private placement with GE Capital, Mechanical Technology Incorporated (Nasdaq:MKTY), DQE Enterprises, Inc., a wholly owned subsidiary of DQE, Inc. (NYSE: DQE), The Beacon Group Energy Investment Fund II, L.P., Penske Corporation, Micro-Generation Technology Fund (Arete Corporation) and Perseus Capital, L.L.C. Beacon Power plans to utilize the proceeds from the private placement to complete the commercialization of its flywheel energy storage system and to begin establishing production capacity. Beacon Power also signed an agreement with Cox Communications to install ten of their flywheel energy storage systems to support the backup power needs of Cox's advanced cable networks. In addition to the agreement with Cox Communications, Beacon Power also has field test units at Bell Atlantic and WinDBreak Cable sites and an initial order for 100 systems with TLER Associates in Mexico."
"There is a growing recognition of the benefits of flywheels over batteries in the communications markets. As cable communications companies enter the world of broadband cable, where they offer interactive bi-directional cable as well as Internet and telephone services, they are realizing the inherent disadvantages of placing traditional battery backup energy storage systems in the field. Flywheels are an alternative to batteries because they can operate more reliably, require less maintenance and are longer lived; they can also be remotely monitored and are more environmentally friendly."
"We were also pleased to be recently added to the Russell 2000 and Russell 3000 indexes of the top performing companies on the basis of market capitalization," concluded Eisenhaure. "This is a milestone for SatCon and I think it reflects growing investor interest in the alternative energy and distributed power generation markets and in SatCon as a participant in this sector." |
