Ideal Power Inc. (NASDAQ:IPWR), an innovative power conversion
technology company, reported results for its first quarter ended
March 31, 2018.
Key First Quarter 2018 and Subsequent
Highlights:
- Completed executive management team changes and corporate
restructuring to support recent progress with PPSA™ and B-TRAN™
technologies and the following executive management changes were
made:
- Chairman of the Board, Dr. Lon E Bell, appointed Chief
Executive Officer and President.
- Former Chief Executive Officer Dan Brdar appointed Chief
Commercial Officer of B-TRAN™ division.
- Chief Financial Officer Tim Burns will manage Power Conversion
Systems business development, purchasing and customer support
functions in addition to his continued role as Chief Financial
Officer.
- Vice President of Engineering Uwe Uhmeyer will manage Power
Conversion Systems R&D and product development activities.
- Power electronics thought leader Ted Lesster appointed to the
company’s board of directors.
Power Conversion Systems Division
- Received a 1.1-megawatt purchase order for SunDial™ Plus
inverters from NEXTracker for one of the largest solar + storage
installations in Iowa.
- Received a two-megawatt purchase order for SunDial™ Plus
inverters for large-scale deployment of advanced solar + storage
solution in China.
- Signed a master purchase agreement with Bosch, a leading global
technology and services provider, to provide Stabiliti™ power
conversion systems for Bosch’s high-efficiency building
solutions.
- Completed 750-Kilowatt purchase order with JLM Energy for
Stabiliti™ series products.
- PPSA™ Patent Estate: Currently have 43 issued PPSA™ patents
with 5 of those patents issued outside the United States, including
coverage in China and Europe. In addition, our pending PPSA™ patent
portfolio will potentially provide coverage in India.
B-TRAN™ Division
- Completed successful proof of concept testing of Bi-directional
bi-polar junction TRANsistor (B-TRAN™) prototypes with test results
supporting third-party simulations.
- B-TRAN™ Patent Estate: Currently have 38 issued B-TRAN™ patents
with 8 of those patents issued outside the United States in China,
Europe and Australia. Our pending B-TRAN™ patent portfolio
includes approximately 40 patent filings and will potentially
provide coverage in Japan, South Korea and India.
Management Commentary
"The first quarter of 2018 was highlighted with progress in our
target markets as evidenced by wins with Brantingham & Carroll
International (BCI), JLM Energy and Bosch,” said Ideal Power CEO
Dr. Lon Bell. “Most importantly, the BCI win represents our first
large scale deployment for a solar + storage solution in the
Chinese market and we are encouraged to see a large international
market such as China embracing solutions utilizing solar + storage.
Excitingly, our B-TRAN™ division made notable progress during the
quarter as we completed a successful proof of concept testing of
B-TRAN™ prototypes with test results supporting third-party
simulations. We expect to have engineering samples for potential
customers and partners later this year,” continued Bell.
“Subsequent to the closing of the first quarter of 2018, we
announced new executive management team changes as part of a
strategic restructuring to support operational progress with our
two primary technologies: PPSA™, a power conversion technology, and
B-TRAN™, a solid-state switch technology. These two separate
operating divisions, Power Conversion Systems and B-TRAN™, each
have their own proprietary technologies, time-to-market,
paths-to-market and manpower skill sets for successful
commercialization. This strategic approach will not only leverage
our time, resources and critical human capital, but also provide
optionality for strategic partners.
“As we enter the midpoint of the second quarter of 2018, the
recent growth in our order backlog and sales pipeline is an
encouraging sign for the Power Conversion Systems division.
Moreover, we recently announced our first material purchase order
from NEXTracker for one of the largest solar-and-storage
installations in Iowa that also represents NEXTracker’s first
large-scale installation of the NX Flow solution,” concluded
Bell.
First Quarter 2018 Financial Results
- Q1 2018 product revenue totalled $0.2 million versus $0.3
million in Q1 2017.
- Q1 2018 gross margins were negative 84% compared to negative
158% in Q1 2017. Gross margins were negatively impacted by warranty
reserve adjustments related primarily to our discontinued
first-generation IBC-30 product.
- Q1 2018 net loss was $2.1 million compared to Q1 2017 net loss
of $3.1 million.
- Q1 2018 cash used in operating and investing activities was
$1.9 million compared to $2.5 million in Q1 2017.
- Cash and cash equivalents totalled $8.2 million as of March 31,
2018, with no long-term debt outstanding.
“Although Q1 2018 product revenue was muted, based upon our
current backlog, we are confident second quarter product revenue
will be in excess of $500,000 with continued progress in sequential
quarters,” said Tim Burns, Chief Financial Officer. “On the cash
management side, we continue to maintain our quarterly cash burn in
the range of $1.7 million to $1.8 million with Q1 being slightly
higher than this baseline due to unfavorable balance sheet timing,
which is typical for us in the first quarter of the year.”
Conference Call Details
Ideal Power Chairman, CEO and President Dr. Lon Bell, CFO Tim
Burns and B-TRAN Chief Commercial Officer Dan Brdar will host the
conference call, followed by a question and answer period.
To access the call, please use the following information:
Date: Thursday, May 10, 2018 Time: 4:30 p.m. ET,
1:30 p.m. PT Toll-free dial-in number: 1-800-289-0438
International dial-in number: 1-323-794-2423 Conference
ID: 4731445
Please call the conference telephone number 5-10 minutes prior
to the start time. An operator will register your name and
organization. If you have any difficulty connecting with the
conference call, please contact MZ Group at 1-949-491-8235.
The conference call will be broadcast live and available for
replay at http://public.viavid.com/player/index.php?id=129608 and
via the investor relations section of the Company’s website at
www.IdealPower.com.
A replay of the conference call will be available after 7:30
p.m. Eastern time through June 10, 2018.
Toll-free replay number: 1-844-512-2921International
replay number: 1-412-317-6671Replay ID: 4731445
About Ideal Power Inc. Ideal Power
(NASDAQ:IPWR) is a power conversion technology company that
delivers innovative solutions to system integrators and project
developers enabling distributed energy resources for applications
both on and off the grid. Ideal Power’s products deliver
reliability and compelling return on investment for renewable
energy and storage applications at a competitive cost, backed by
first-rate customer service. With its patented power conversion
technology, Ideal Power supports a broad set of growing markets,
including solar + storage, battery energy storage and
microgrids.
Ideal Power’s patented Bi-directional Bi-polar Junction
Transistor (B-TRAN) semiconductor technology is a unique
double-sided bi-directional AC switch expected to deliver
substantial performance improvements over today's conventional
power semiconductors. B-TRANs offer the potential to improve
efficiency and system economics of a wide variety of power
converter applications including electrified vehicle traction
drives, energy storage applications, photovoltaic (PV) inverters
and wind converters, variable frequency (VFD) motor drives, and AC
and DC power control applications. For more information,
visit www.IdealPower.com.
Safe Harbor StatementAll statements in this
release that are not based on historical fact are "forward-looking
statements" within the meaning of the Private Securities Litigation
Reform Act of 1995 and the provisions of Section 27A of the
Securities Act of 1933, as amended, and Section 21E of the
Securities Exchange Act of 1934, as amended. While management
has based any forward-looking statements included in this release
on its current expectations, the information on which such
expectations were based may change. These forward-looking
statements rely on a number of assumptions concerning future events
and are subject to a number of risks, uncertainties and other
factors, many of which are outside of our control that could cause
actual results to materially differ from such statements. Such
risks, uncertainties, and other factors include, but are not
limited to, market acceptance of our products in the solar +
storage market, the success of our B-TRAN technology, whether the
patents for our technology provide adequate protection and whether
we can be successful in maintaining, enforcing and defending our
patents, the timing and impact of regulatory developments affecting
the markets for our products, our inability to predict with
precision or certainty the pace of development and
commercialization of our advanced technologies, unanticipated costs
in connection with the discontinuation our legacy product families,
the uncertainty of whether the demand for energy storage products
will grow at a pace consistent with our expectations, whether our
backlog will translate into revenue in future periods, whether
demand for our products will develop, and whether we can
compete successfully with other manufacturers and suppliers of
power conversion products, both now and in the future, as new
products are developed and marketed, whether our cost reduction
efforts will be successful and other risks and uncertainties set
forth in our quarterly and annual reports filed with the Securities
and Exchange Commission. Furthermore, we operate in a highly
competitive and rapidly changing environment where new and
unanticipated risks may arise. The availability and amount of
government incentive programs affect our customers spending
patterns, and adverse changes or developments in such programs –
such as the SGIP in California – have materially and adversely
affected our orders, net sales, gross profit and net income, and
may do so again in the future. Accordingly, investors should
not place any reliance on forward-looking statements as a
prediction of actual results. We disclaim any intention to, and
undertake no obligation to, update or revise forward-looking
statements. Ideal Power Investor Relations
Contact: MZ North America Chris Tyson
949-491-8235IPWR@mzgroup.us www.mzgroup.us
IDEAL POWER INC.Balance
Sheets
|
|
March 31, 2018 |
|
December 31, 2017 |
|
|
(unaudited) |
|
|
ASSETS |
|
|
|
|
Current assets: |
|
|
|
|
Cash and
cash equivalents |
|
$ |
8,153,268 |
|
|
$ |
10,022,247 |
|
Accounts
receivable, net |
|
152,716 |
|
|
221,084 |
|
Inventories, net |
|
227,005 |
|
|
251,363 |
|
Prepayments and other current assets |
|
251,146 |
|
|
283,208 |
|
Total
current assets |
|
8,784,135 |
|
|
10,777,902 |
|
|
|
|
|
|
Property and equipment,
net |
|
573,026 |
|
|
669,571 |
|
Intangible assets,
net |
|
2,088,428 |
|
|
2,082,014 |
|
Other assets |
|
37,500 |
|
|
37,500 |
|
Total
Assets |
|
$ |
11,483,089 |
|
|
$ |
13,566,987 |
|
|
|
|
|
|
LIABILITIES AND STOCKHOLDERS’ EQUITY |
|
|
|
|
Current
liabilities: |
|
|
|
|
Accounts
payable |
|
$ |
299,730 |
|
|
$ |
449,475 |
|
Accrued
expenses |
|
1,008,149 |
|
|
1,081,155 |
|
Total
current liabilities |
|
1,307,879 |
|
|
1,530,630 |
|
|
|
|
|
|
Other long-term
liabilities |
|
459,216 |
|
|
456,234 |
|
Total
liabilities |
|
1,767,095 |
|
|
1,986,864 |
|
|
|
|
|
|
Commitments and
contingencies |
|
|
|
|
|
|
|
|
|
Stockholders’
equity: |
|
|
|
|
Preferred
stock, $0.001 par value; 10,000,000 shares authorized; 1,518,430
shares issued and outstanding at March 31, 2018 and December 31,
2017, respectively |
|
1,518 |
|
|
1,518 |
|
Common
stock, $0.001 par value; 50,000,000 shares authorized; 13,998,465
shares issued and 13,996,121 shares outstanding at March 31, 2018
and December 31, 2017, respectively |
|
13,998 |
|
|
13,998 |
|
Additional paid-in capital |
|
67,273,392 |
|
|
67,081,359 |
|
Treasury
stock, at cost, 2,344 shares at March 31, 2018 and December 31,
2017, respectively |
|
(7,489 |
) |
|
(7,489 |
) |
Accumulated deficit |
|
(57,565,425 |
) |
|
(55,509,263 |
) |
Total
stockholders’ equity |
|
9,715,994 |
|
|
11,580,123 |
|
Total
Liabilities and Stockholders’ Equity |
|
$ |
11,483,089 |
|
|
$ |
13,566,987 |
|
IDEAL POWER
INC.Statements of
Operations(unaudited)
|
|
Three Months Ended March 31, |
|
|
2018 |
|
2017 |
Product revenue |
|
$ |
181,500 |
|
|
$ |
275,670 |
|
Cost of product
revenue |
|
334,963 |
|
|
710,930 |
|
Gross
profit loss |
|
(153,463 |
) |
|
(435,260 |
) |
|
|
|
|
|
Operating
expenses: |
|
|
|
|
Research
and development |
|
757,783 |
|
|
1,190,169 |
|
General
and administrative |
|
891,988 |
|
|
905,963 |
|
Sales and
marketing |
|
254,243 |
|
|
541,533 |
|
Total
operating expenses |
|
1,904,014 |
|
|
2,637,665 |
|
|
|
|
|
|
Loss from
operations |
|
(2,057,477 |
) |
|
(3,072,925 |
) |
|
|
|
|
|
Interest income,
net |
|
1,315 |
|
|
4,541 |
|
|
|
|
|
|
Net loss |
|
$ |
(2,056,162 |
) |
|
$ |
(3,068,384 |
) |
|
|
|
|
|
Net loss per share –
basic and fully diluted |
|
$ |
(0.15 |
) |
|
$ |
(0.28 |
) |
|
|
|
|
|
Weighted average number
of shares outstanding – basic and fully diluted |
|
13,991,121 |
|
|
10,879,690 |
|
IDEAL POWER
INC.Statements of Cash
Flows(unaudited)
|
|
Three Months Ended March 31, |
|
|
2018 |
|
2017 |
Cash flows from
operating activities: |
|
|
|
|
Net
loss |
|
$ |
(2,056,162 |
) |
|
$ |
(3,068,384 |
) |
Adjustments to reconcile net loss to net cash used in operating
activities: |
|
|
|
|
Allowance
for doubtful accounts |
|
18,235 |
|
|
60,703 |
|
Write-down of inventory |
|
(833 |
) |
|
348,793 |
|
Depreciation and amortization |
|
113,808 |
|
|
113,068 |
|
Write-off
of capitalized patents |
|
10,873 |
|
|
559 |
|
Write-off
of fixed assets |
|
7,056 |
|
|
10,534 |
|
Stock-based compensation |
|
192,033 |
|
|
384,329 |
|
Decrease
(increase) in operating assets: |
|
|
|
|
Accounts
receivable |
|
50,133 |
|
|
(247,512 |
) |
Inventories |
|
25,241 |
|
|
44,491 |
|
Prepayments and other current assets |
|
32,062 |
|
|
7,780 |
|
Increase
(decrease) in operating liabilities: |
|
|
|
|
Accounts
payable |
|
(149,745 |
) |
|
16,566 |
|
Accrued
expenses |
|
(70,024 |
) |
|
(116,648 |
) |
Net cash
used in operating activities |
|
(1,827,373 |
) |
|
(2,445,721 |
) |
|
|
|
|
|
Cash flows from
investing activities: |
|
|
|
|
Purchase
of property and equipment |
|
– |
|
|
(4,378 |
) |
Acquisition of intangible assets |
|
(41,606 |
) |
|
(72,376 |
) |
Net cash
used in investing activities |
|
(41,606 |
) |
|
(76,754 |
) |
|
|
|
|
|
Cash flows from
financing activities: |
|
|
|
|
Net
proceeds from issuance of common stock |
|
– |
|
|
13,657,331 |
|
Exercise
of options and warrants |
|
– |
|
|
11,143 |
|
Net cash
provided by financing activities |
|
– |
|
|
13,668,474 |
|
|
|
|
|
|
Net increase (decrease)
in cash and cash equivalents |
|
(1,868,979 |
) |
|
11,145,999 |
|
Cash and cash
equivalents at beginning of period |
|
10,022,247 |
|
|
4,204,916 |
|
Cash and cash
equivalents at end of period |
|
$ |
8,153,268 |
|
|
$ |
15,350,915 |
|
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