For those that didn't follow Allen's post... the news is out.
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Energy Conversion Devices Announces Second Quarter Operating Results
February 17, 1999 10:14
TROY, Mich., Feb. 17 /PRNewswire/ -- Energy Conversion Devices, Inc. ("ECD") (Nasdaq: ENER) today announced operating results for the three months and six months ended December 31, 1998 as follows:
Three Months Ended Six Months Ended
December 31, December 31,
1998 1997 1998 1997
(In thousands) (In thousands)
Revenues $11,869 $8,748 $18,047 $15,209
Expenses $11,529 $12,377 $22,141 $23,311
Net income (loss)
from operations $340 $(3,629) $(4,094) $(8,102)
Other income $1,326 $122 $536 $298
Net income (loss) $1,666 $(3,507) $(3,558) $(7,804)
Basic Net income (loss)
per common share $.13 $(.32) $(.28) $(.72)
The Company had consolidated revenues for the second quarter ended December 31, 1998 of $11,869,000 compared with $8,748,000 in the second quarter in the year earlier period. Net income was $1,666,000, or $.13 basic net income per share, and included a $1,970,000 gain (recognition of an additional $1,000,000 gain has been deferred pending completion of certain contract terms) on the sale of Ovonic Battery common stock and a $4,400,000 license fee from Sanyo Electric Co., Ltd. ("Sanyo"), partially offset by a $1,027,000 expense related to the Company's $2,500,000 cash investment in United Solar Systems Corp. ("United Solar") as required under generally accepted accounting principles, regardless of the true value of the investment. The Company's investment in United Solar provides funding for new opportunities in the worldwide photovoltaic market served by United Solar's products which offer unique advantages to the satellite and telecommunications industries. In the quarter ended December 31, 1997, the Company had a net loss of $3,507,000, or $.32 basic net loss per share.
For the first six months of the 1999 fiscal year, revenues were $18,047,000 compared to $15,209,000 for the same period last year. The net loss for the six months of fiscal 1999 was $3,558,000, or $.28 basic net loss per share, compared to a net loss of $7,804,000 for the year earlier period, or $.72 basic net loss per share.
Stanford R. Ovshinsky, ECD president and chief executive officer, said, "Profitability for the second quarter is welcomed. Acceptance of our technologies has led to increased license fees and royalties. Continued improvements of our operating results is a top priority in 1999."
Robert C. Stempel, ECD chairman, said, "The Company's profitability for the second quarter is the result of our expanded license and cooperative joint venture agreement with Sanyo. While we continue to develop new license agreements, our operating plan also calls for further cost reductions and improvements in manufacturing efficiency. The results of these actions should be apparent in the coming year."
Notes to Operating Results
Three Months Ended Six Months Ended
December 31, December 31,
1998 1997 1998 1997
(In thousands) (In thousands)
REVENUES
Product sales $1,041 $2,669 $2,008 $5,243
Royalties 617 757 1,232 1,095
Revenues from product
development agreements 4,829 4,120 8,602 6,911
Revenues from license and
other agreements 4,442 359 4,484 417
Other 940 843 1,721 1,543
TOTAL REVENUES $11,869 $8,748 $18,047 $15,209
Product sales decreased compared to the same periods in 1997 primarily due to the decision by one of the Company's principal customers to currently manufacture its own electrode products. In order to expand its capacity with the installation of new equipment, the Company also temporarily suspended operations in its positive powder manufacturing facility.
Royalties decreased in the three months ended December 31, 1998 primarily due to the fact that the 1997 period included an adjustment for additional royalties from NiMH battery sales in Japan due to the basic patent issued in Japan in 1997. Royalties increased in the six months ended December 31, 1998 primarily due to higher battery royalties resulting from the issuance of a basic patent in Japan in 1997. The widespread acceptance of NiMH batteries has led to large volume production which continues to increase significantly, resulting in lower unit sales price that has affected royalties received by the company.
Revenues from product development agreements increased in both the three- and six-month periods by 17% and 24%, respectively, due primarily to increased revenues from a program with General Motors Corporation to develop second and third generation Ovonic NiMH batteries for electric and hybrid electric vehicle applications. Revenues from product development agreements for ECD's optical memory and photovoltaic technologies were also significantly higher for both periods.
Revenues from license and other agreements in the three months and six months ended December 31, 1998 increased to $4,442,000 and $4,484,000, respectively, from $359,000 and $417,000, respectively, in the same periods in 1997 due to the license fee in 1998 from Sanyo.
ECD is a leader in the synthesis of new materials and the development of advanced production technology and innovative products. It has pioneered and developed enabling technologies leading to new products and production processes based on amorphous, disordered and related materials, with an emphasis on alternative energy and advanced information technologies. ECD's web site address is ovonic.com.
This release may contain forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements are based on assumptions which ECD, as of the date of this release, believes to be reasonable and appropriate. ECD cautions, however, that the actual facts and conditions that may exist in the future could vary materially from the assumed facts and conditions upon which such forward-looking statements are based.
SOURCE Energy Conversion Devices
/CONTACT: Stephan Zumsteg, Treasurer, or Ghazaleh Koefod, of Energy
Conversion Devices, 248-280-1900; or Steven Curtis of Ruder Finn,
212-593-6319/
/Company News On-Call: prnewswire.com or fax,
800-758-5804, ext. 283250/
/Web site: ovonic.com
(ENER)
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