updated 11/8/2010 8:46:09 AM ET 2010-11-08T13:46:09

NORCROSS, Ga., Nov. 8, 2010 (GLOBE NEWSWIRE) -- Comverge, Inc. (Nasdaq:COMV), the leading provider of Intelligent Energy Management (IEM) solutions for Residential and Commercial + Industrial customers, today announced third quarter 2010 financial and operating results.

  • Record quarterly revenues of $51.7 million, a 56% increase over prior year
  • Awarded a $33 million contract expansion at TXU Energy for over 100,000 homes
  • Awarded a comprehensive residential and C&I pilot demand response contract with Public Service Company of Oklahom

"The third quarter of 2010 was a busy and productive time for Comverge. We established a new vision and brand for our company, secured several strategic residential customer wins, grew our C+I business and successfully kept the power on for hundreds of thousands of East Coast residents during a crippling heat wave," said R. Blake Young, president and CEO, Comverge. "Achieving all of this in the span of three months is a testament to our team and leading intelligent energy management solutions. In addition to having a positive impact on our revenue for the third quarter, this also positions us to close out the year strongly and establishes the foundation for a highly successful 2011."

Financial Summary

Third quarter revenues for 2010 were $51.7 million compared to $33.2 million in the third quarter of 2009, a 56% increase. Revenues for both periods exclude revenues from our residential Virtual Peaking Capacity (VPC) contracts, which are deferred and recognized in the fourth quarter.

Gross margin for the third quarter of 2010 was 31.4% compared to 28.5% in the third quarter of 2009. Gross margins are most meaningful when comparing on a 12 month basis due to the deferral of VPC contract revenues. Deferred VPC contract revenues at September 30, 2010 were $18.8 million with a deferred gross margin of 73%, compared to a deferred gross margin of 53% at September 30, 2009.

Adjusted EBITDA for the third quarter of 2010 was a positive $1.0 million compared to a negative $3.9 million for the third quarter of 2009, a $4.9 million improvement. Adjusted EBITDA is earnings before interest, taxes, depreciation, amortization and non-cash stock compensation expense.

Net loss for the third quarter of 2010 was $1.4 million, or $0.06 per share basic and diluted, compared to a net loss of $9.4 million, or $0.44 per share basic and diluted for the third quarter of 2009, an improvement of $8.0 million. Net loss for the third quarter of 2010 included a one time expense of $0.9 million, or $0.04 per share basic and diluted, related to the previously announced restructuring and centralization of staff to our corporate headquarters. Net loss for the third quarter of 2009 included a one time expense of $4.3 million, or $0.20 per share basic and diluted, related to the retirement of the Company's former CEO.

Excluding stock-based compensation charges and amortization expense of acquisition-related assets, net of tax effects, non-GAAP net income for the third quarter of 2010 was $0.2 million, or $0.01 per basic and diluted share, compared to a non-GAAP net loss of $4.9 million, or $0.23 per basic and diluted share, for the same period in 2009, a $5.1 million improvement.

Please refer to the financial schedules attached to this press release for reconciliation of GAAP to non-GAAP Adjusted EBITDA, net loss and net loss per share.

Business Highlights

Comverge third quarter 2010 business highlights include:

- announced the extension and expansion of our support of the TXU Energy iThermostat(TM) program through 2012. Under the two-year $33 million renewable agreement, Comverge's IntelliSOURCE® Demand Response Management System, the industry's leading intelligent energy management platform, will empower an expanded program which includes the installation of more than 100,000 residential and commercial energy management devices;

- announced we were selected by Public Service Company of Oklahoma (PSO), to deliver a comprehensive energy management pilot program to eligible residential and commercial customers. PSO's demand response program will be built on Comverge's IntelliSOURCE ® Demand Response Management System software, the industry's leading energy management software platform; and

- increased total megawatts under management by 642 megawatts during the first nine months of 2010, 186 megawatts of which were added during the third quarter of 2010. Total megawatts under management as of September 30, 2010 and December 31, 2009 were:

Recent Developments

- Added two new directors to the board, John McCarter and John Rego who together bring a combined 60 years experience in energy and finance.

- Completed a 5 year $15 million convertible debt financing last week with Partners for Growth L.P. to strengthen our cash position thereby giving us the capital we need to fund our growth through at least 2011.

Current Outlook

We are revising our revenue outlook for full year 2010 and expect revenues to be in the range of $118 to $125 million, reflecting continuing weakness in the revenues reported under our energy efficiency contracts. We also expect to grow total megawatts under management by 800 megawatts. 

As of September 30, 2010, through our long-term capacity contracts, turnkey contracts and open market auction programs, we have approximately $615 million in total contracted future revenues. Furthermore, we have been awarded 997 megawatts of capacity in the 2013 - 2014 PJM Reliability Pricing Model Base Residual Auction, or BRA. In the event we secure adequate load capacity to meet our obligations under the 2013 - 2014 PJM BRA, we will have 4102 in total megawatts managed. 

The above statements are based on current expectations. These statements are forward-looking and actual results may differ materially. The Company assumes no obligation to publicly update or revise its outlook. Investors are reminded that actual results may differ from these estimates for the reasons described below under the caption "Caution Regarding Forward Looking Statements" and in our filings with the Securities and Exchange Commission.

Additional Information

Comverge will discuss these results for the third quarter 2010 as well as its expectations for the future in a conference call scheduled today at 9:00 a.m. ET. To participate in the call, dial 877-334-1969 or 760-666-3589 for international participants.

Additionally, the results will be reported in the Investor Relations section on Comverge's website at http://ir.comverge.com . An audio replay of the call will be available beginning November 8, 2010 at 1:00 p.m. and available until November 16, 2010 at 12:00 a.m. EST (midnight) by dialing in 800-642-1687 (706-645-9291 for international participants) and using conference code number 18630863.

Additional financial information can be found in the Company's Quarterly Report on Form 10-Q for the quarter ended September 30, 2010, which has been filed today with the Securities and Exchange Commission.

About Comverge

With more than 500 utility and 2,100 commercial customers, as well as five million deployed residential devices, Comverge brings unparalleled industry knowledge and experience to offer the most reliable, easy-to-use, and cost-effective intelligent energy management programs. We deliver the insight and control that enables energy providers and consumers to optimize their power usage through the industry's only proven, comprehensive set of technology, services and information management solutions. For more information, visit www.comverge.com.

Caution Regarding Forward Looking Statements

This release contains forward-looking statements that are made pursuant to the safe harbor provisions of Section 21E of the Securities Exchange Act of 1934. The forward-looking statements in this release are not and do not constitute historical facts, do not constitute guarantees of future performance and are based on numerous assumptions which, while believed to be reasonable, may not prove to be accurate. These forward looking statements include projected revenue guidance, projected contracted revenues, projected regulatory changes or approvals, the amount of revenue and megawatts that will be generated by long-term contracts or open market programs and certain assumptions upon which such forward-looking statements are based. The forward-looking statements in this release do not constitute guarantees of future performance and involve a number of factors that could cause actual results to differ materially, including risks associated with Comverge's business involving our products, the development and distribution of our products and related services, regulatory changes or grid operator rule changes, regulatory approval of our contracts, economic and competitive factors, our key strategic relationships, and other risks more fully described in our most recently filed Annual Report on Form 10-K and Quarterly Report on Form 10-Q filed today. Comverge assumes no obligation to update any forward-looking information contained in this press release or with respect to the announcements described herein.

Regulation G Disclosure - Non-GAAP Financial Information

Non-GAAP financial measures are based upon our unaudited consolidated statements of operations for the periods shown, giving effect to the adjustments shown in the reconciliations set forth below. This presentation is not in accordance with, or an alternative for, U.S. generally accepted accounting principles (GAAP). The non-GAAP financial information presented herein should be considered supplemental to, and not as a substitute for, or superior to, financial measures calculated in accordance with GAAP. However, Comverge believes that non-GAAP reporting, giving effect to the adjustments shown in the reconciliations below, provides meaningful information and therefore uses it to supplement its GAAP reporting and internally in evaluating operations, managing and benchmarking performance. The Company has chosen to provide this supplemental information to investors, analysts and other interested parties to enable them to perform additional analyses of operating results, to illustrate the results of operations giving effect to the non-GAAP adjustments shown in the reconciliations below, and to provide an additional measure of performance.

For Schedules 5 and 6, see footnote (1) Reconciliation of Non-GAAP Financial Measures to comparable U.S. GAAP measures which follows Schedule 6.

© Copyright 2012, GlobeNewswire, Inc. All Rights Reserved


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