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Technology Stocks : Energy Conversion Devices -- Ignore unavailable to you. Want to Upgrade?

To: Joe Master who wrote (2337)	9/21/1998 10:13:00 AM
From: WALT REISCH	Read Replies (1) \| Respond to of 8393

INTERVIEW - Energy Conversion eyes electric cars Reuters Story - September 21, 1998 08:15 By Kristin Roberts NEW YORK, Sept 21 (Reuters) - The former chief executive officer of General Motors Corp. is betting on electric-powered scooters and cars' success in the European and Asian markets to help turn profits for his smaller energy storage company, Energy Conversion Devices Inc. . But it could take 18 to 24 months for Energy Conversion to post those earnings, Robert Stempel, chairman of Energy Conversion told Reuters Wednesday. "I think within the next 18 months, two years we're going to be moving smartly toward that," Stempel said in reference to profitability. "It has started," he said, adding that growth will be determined by consumers' zeal to switch to electric. But the chairman would not comment on specific earnings projections. Analysts polled by First Call expect the company's per share losses in the fourth quarter, ended June 30, narrowed to $0.33 compared with a fourth quarter 1997 loss of $0.46 per share. The analysts polled by First Call projected growth continuing in 1999 with the company posting an annual loss of $0.85 compared with analysts' estimates of $1.40 in per share losses this year. Last year, Energy Conversion reported a loss of $1.67 per share. For the third quarter ended March 31, the company posted a net loss of $3.7 million compared with a loss almost twice that during the same period in 1997 of $7.1 million. Quarterly per share losses, likewise, were almost halved at $0.35 versus $0.66 last year. The rate of bottom line growth will be determined, Stempel said, by the development of the consumer market for battery-powered energy. "Certainly the European and Asian markets will be profitable," he said, noting gasoline prices in Europe are higher than in the United States and some governments are leaning toward zero-emission regulations in urban areas. The company has begun to shift its spending, according to the chairman, from research and development into manufacturing of its patented photovoltaic and battery technology. "We've been basically R & D with some manufacturing," Stempel said. "But I'm absolutely convinced for the health of the company going forward we need a cash flow base. We'll derive that from manufacturing operations." With the transition to manufacturing, the company will consider offering investors a royalty trust structure as a way to finance equity while moving toward profitability, Stempel said. Despite the company's involvement in Russia, where it found resources used in solar cell and battery products, Energy Conversion expects improvement in its bottom line from increased sales in China, Southeast Asia, Europe and the United States. Ventures in Japan, encouraged by the Japanese recognition of Energy Conversion's photovoltaic and battery product patents, have pushed revenues up, narrowing the company's net and per share losses. The company also has continued its manufacturing alliances in Russia, where it has a 50 percent stake in each of two joint ventures with government agencies, despite the financial and political volatility in the country. "Right now, Russia's a tough place to do business," Stempel said. "I wouldn't tell you I have a high comfort level with all of those joint ventures over there," Stempel said. "But technically I'm very proud of them." In the near-term, Stempel said he sees growth from sales of the company's rewritable memory technology, such as compact disks that may be erased and rerecorded. The chairman said the DVD rewritable technology should begin marketing by the upcoming Christmas season and force a revenue stream of more than $1 million by its second year in the consumer market.