Fourth Quarter Solar Revenue Up 77% Over Prior Year, 25% Over Prior Quarter
Total Cash Position Improves to $205 Million
Project Pipeline Grows by Over 150 Megawatts
ROCHESTER HILLS, Mich., Aug. 31, 2010 (GLOBE NEWSWIRE) -- Energy Conversion Devices, Inc. (ECD) (Nasdaq:ENER), a leading global provider of thin-film flexible solar laminate products and systems for the building integrated and commercial rooftop markets, today announced financial results for its fourth quarter and fiscal year ended June 30, 2010.
Total consolidated revenues for the quarter were $86.2 million, compared to $51.4 million in the fourth quarter of fiscal 2009, a 68% increase, and $72.4 million in the third quarter of fiscal 2010, a 19% increase. Solar product and system sales for the quarter were $81.3 million, compared to $46.0 million in the same quarter last year, a 77% increase, and $65.1 million in the third quarter of fiscal 2010, a 25% increase.
For the fourth quarter, the company reported a loss of $20.4 million or $0.48 per fully diluted share compared to a net loss of $17.6 million or $0.42 per fully diluted share in the year-ago period. This compares to a net loss of $26.8 million or $0.63 per fully diluted share in the third quarter of fiscal 2010, which excluded a non-cash impairment charge of $358.0 million or $8.46 per share.
The company reported an increase in cash, cash-equivalents and short-term investments of $7.4 million during the quarter, compared to a decrease of $38.3 million in the fourth quarter of fiscal 2009 and a decrease of $19.6 million in the third quarter of fiscal 2010. The company's total reported cash position at the end of the fiscal year stood at $204.7 million, which includes $11.7 million of restricted cash.
Fourth quarter net results were negatively affected by the following items, which had an aggregate effect of $11.0 million: under-absorption of factory overhead costs of $6.2 million, a restructuring charge of $1.3 million, inventory reserves of $2.4 million and a net foreign currency transaction loss of $1.1 million. In addition, the company recognized a non-cash gain on the early extinguishment of debt of $4.3 million due to the exchange of $23 million par value of the company's outstanding convertible notes for common stock. The net impact of these items was an increase of the quarter's net loss by $6.7 million, or $0.16 per fully diluted share.
Mark Morelli, ECD's President and Chief Executive Officer said, "Our fourth quarter results demonstrate solid progress. We have expanded shipments, reduced inventory, improved cash flow and increased revenue on a sequential basis. We remain aggressively focused on improving sales and margins and bringing our overall costs down. Our demand creation activities continue to gain traction as we have added 150 megawatts to our project pipeline."
For the fiscal year ended June 30, 2010, total consolidated revenues were $254.4 million compared to $316.3 million in the prior year. Solar product and system sales were $230.2 million for fiscal 2010 compared to solar product sales of $295.0 million in the prior year. Net loss for fiscal year 2010 was $456.0 million or $10.72 per fully diluted share versus net income of $8.5 million or $0.20 per fully diluted share in the year-ago period, as adjusted due to the implementation of FASB ASC 470-20. Fiscal year 2010's net loss was impacted by several items including non-cash impairment charges of $359.2 million, restructuring charges of $4.7 million, transaction costs from the acquisition of Solar Integrated Technologies of $3.0 million, non-cash losses on asset disposals of $1.1 million, net foreign currency transaction losses of $2.4 million and the $4.3 million non-cash gain on the early extinguishment of debt described above. When taken collectively, these items increased fiscal year 2010's net loss by $366.1 million or $8.61 per share.
The company also provided guidance for fiscal year 2011 as follows:
Morelli added, "We expect to grow our business substantially in fiscal 2011, although our quarterly results may show unevenness due to project timing uncertainties and the relative growth in our systems business, for which revenue recognition can be delayed by several quarters following initial product shipments. For example, we expect to nearly double shipments year over year in the first quarter, but will not recognize the revenue for many of these shipments until later in the fiscal year. As a greater proportion of our business is generated from projects, we will see continued revenue growth, enhanced system-derived margin, and increased visibility moving forward."
"Building on our improvement in fiscal 2010, I am confident that we are achieving operating cash flow breakeven, as we begin realizing the benefits of our recent cost reduction activities, which in concert with increased production, will lead to a dramatic improvement in our cost per watt as the year progresses. We are also establishing the foundation to achieve sustainable profitability by running our factories at or above nameplate capacity, taking additional cost out of our business, launching new and innovative products, growing our systems business, and following our technology roadmap," concluded Morelli.
Conference Call / Webcast Details
Management of Energy Conversion Devices will review these financial results on a conference call on Tuesday, August 31, 2010, at 10:00 a.m. ET. To participate in the conference call, please dial (877) 858-2512 or (706) 634-6076 (international) at least 10 minutes prior to the start of the call. Callers will need to reference conference ID number 95081245.The conference call will be webcast live over the Internet and can be accessed in the Investor Relations – Events section of the company's website at .
An audio replay of the call will be available approximately two hours after the conclusion of the call. The replay will remain available until 11:59 p.m. EDT September 2, 2010 and can be accessed by dialing (800) 642-1687 or (706) 645-9291 (international) and entering conference ID number 95081245. The webcast will also be archived on the Company's website.
About Energy Conversion Devices
Energy Conversion Devices is a leading global provider of thin-film flexible solar laminate products and systems for the building integrated and commercial rooftop markets. The company manufactures, sells and installs thin-film solar laminates that convert sunlight to energy using proprietary technology. ECD's UNI-SOLAR® brand products are unique because of their flexibility, light weight, ease of installation, durability, and real-world efficiency. Through its Solar Integrated Technologies business, the company also designs, manufactures and installs rooftop photovoltaic systems which enable customers to transform unused space on the rooftop into a value-generating asset. In addition, ECD's Ovonic Materials Division is the pioneer in NiMH battery technology, and is developing low cost fuel cells, hydrogen production from bioreformation, and hydrogen storage technologies. For more information, please visit .
This release may contain forward-looking statements within the meaning of the Safe Harbor Provisions of the Private Securities Litigation Reform Act of 1995. Forward-looking statements include statements concerning our plans, objectives, goals, strategies, future events, future net sales or performance, capital expenditures, financing needs, plans or intentions relating to expansions, business trends and other information that is not historical information. All forward-looking statements are based upon information available to us on the date of this release and are subject to risks, uncertainties and other factors, many of which are outside of our control, that could cause actual results to differ materially from the results discussed in the forward-looking statements. Risks that could cause such results to differ include: our ability to maintain our customer relationships; the worldwide demand for electricity and the market for solar energy; the supply and price of components and raw materials for our products; and our customers' ability to access the capital needed to finance the purchase of our product. The risk factors identified in the ECD filings with the Securities and Exchange Commission, including the company's most recent Annual Report on Form 10-K and most recent Quarterly Report on Form 10-Q, could impact any forward-looking statements contained in this release. Energy Conversion Devices, Inc. assumes no responsibility to update any forward-looking statements contained herein.
CONTACT: Energy Conversion Devices, Inc. Michael E. Schostak, Head of Investor Relations (248) 299-6063 email@example.com