SatCon Technology Corporation� (NASDAQ CM: SATC), a developer of
power management and system architecture solutions for the
alternative energy and distributed power markets, today announced
its operating results for the quarter and year ended December 31,
2006. Revenues for the year ended December 31, 2006 were comparable
to prior year revenues of $33.8 million. Revenues in our Stationary
Power Systems business grew 44% to $14.2 million with an increase
in alternative energy products of 74% to $10.6 million compared to
$6.1 million in 2005 and the Electronics business grew 10% to $10.2
million, offset by revenue decreases associated with the sale of
non-strategic product lines. This revenue shift reflects the
Company�s effort to focus on higher margin products and products
targeted at the alternative energy and distributed power markets.
This is also consistent with our recently announced strategic
collaboration with International Master Technologies I+Tec to
establish a SatCon presence in Spain to serve the expanding
European alternative energy market. Looking forward, this shift can
be further seen in the order backlog, which is at an all-time high
of $35 million, up 60% compared with this same time a year ago.
Orders on hand in our Stationary Power Systems business were $16
million, an increase of over 100%, compared with $8 million a year
ago. The renewable energy portion of that backlog is approximately
$5 million, compared to just over $2 million one year ago. This
growth in renewable energy revenue from $6.1 in 2005 to $10.6
million in 2006 and in backlog orders of approximately $8 million
are indicative of the success the Company is having with its shift
in focus on its power management and system architecture solutions
for the alternative energy and distributed power markets. �I am
pleased to see that our strategic shift toward our alternative
energy business has resulted in product line revenue growth of 74%,
driven by a 120% increase in revenues from solar inverters,�
commented David Eisenhaure, President and Chief Executive Officer.
�For the quarter and year ended December 31, 2006, solar inverter
revenues were $3.3 million and $8.8 million, up 230% and 120%,
respectively, driven by a superior product, strong customer service
and expanding relationships with the leading systems integrators in
commercial solar markets. This growth in alternative energy revenue
is complimented by growth in our high reliability electronics and
continued sales of hybrid-electric vehicle and distributed power
technologies. Over the past year, we have made a conscious effort
to become more product and market focused versus solely technology
driven, and we are seeing the benefits of that in both our revenue
and backlog growth. We are also excited about our recent strategic
alliance with International Master Technologies I+Tec to expand our
global strategy for alternative energy. Commercial markets are
rapidly expanding in southern Europe, and a local presence is
imperative to serve our global customers and new European
customers.� Operating loss for the year ended December 31, 2006
increased to $14.8 million compared with an operating loss of $9.5
million for the same period in 2005. The primary differences were a
one-time gain of $1.4 million on the sale of our Shaker product
line in 2005, a non-cash stock based compensation charge of
approximately $1.0 million, and an increase in our investments in
R&D and SG&A of approximately $2.6 million. These R&D
and SG&A investments were steps taken to drive the strategic
shift in the business for future revenue growth, which we began to
realize in 2006 in our Stationary Power Systems business. Operating
loss for the quarter was $4.5 million, compared with an operating
loss of $1.2 million in 2005. Net loss for the year ended December
31, 2006 was $20.0 million, or $0.51 per share, compared with a net
loss of $10.1 million, or $0.29 per share, for the same period in
2005. A major contributor to the increase in net loss for both the
quarter and year to date (as compared with the prior periods in
2005) were non-cash charges of over $4.4 million associated with
the valuation of our Senior Convertible Secured Notes and warrants
and the related derivatives and other investment spending noted
above. �We have taken steps to align our organization with our
revenue growth initiatives,� said David Eisenhaure. �As an
indication of our commitment to the growth prospects in renewable
energy, distributed power and electronics, approximately 70% of our
employees and 60% of our facilities are now dedicated to these
faster growing businesses.� About SatCon Technology Corporation
SatCon Technology Corporation is a developer and manufacturer of
electronics and motors for the Alternative Energy, Hybrid-Electric
Vehicle, Grid Support, High Reliability Electronics and Advanced
Power Technology markets. For further information, please visit the
SatCon website at www.satcon.com. (SATC-E) Statements made in this
document that are not historical facts or which apply prospectively
are forward-looking statements that involve risks and
uncertainties. These forward-looking statements are identified by
the use of terms and phrases such as �will,� �believes,� �expects,�
�plans,� �anticipates� and similar expressions. Investors should
not rely on forward looking statements because they are subject to
a variety of risks and uncertainties and other factors that could
cause actual results to differ materially from the Company�s
expectation. There can be no assurance that the company will
continue to maintain this level of new orders or that it can
successfully deliver the components and systems ordered. Additional
information concerning risk factors is contained from time to time
in the Company�s SEC filings. The Company expressly disclaims any
obligation to update the information contained in this release.
SATCON TECHNOLOGY CORPORATION CONSOLIDATED BALANCE SHEETS �
December 31, 2006 December 31, 2005 ASSETS Current assets: Cash and
cash equivalents $8,190,827� $9,194,720� Restricted cash and cash
equivalents 84,000� 84,000� Accounts receivable, net of allowance
of $792,245 and $800,564 at December 31, 2006, 2005, respectively
8,549,923� 5,332,668� Unbilled contract costs and fees 267,247�
114,899� Inventory 7,945,874� 6,502,168� Prepaid expenses and other
current assets 756,884� 710,924� � Total current assets
$25,794,755� $21,939,379� � Property and equipment, net 2,783,900�
3,396,432� Goodwill, net 704,362� 704,362� Intangibles, net
1,224,488� 1,736,152� Other long-term assets 69,782� 551,750� �
Total assets $30,577,287� $28,328,075� � LIABILITIES AND
STOCKHOLDERS' EQUITY Current liabilities: Bank line of credit $��
$2,000,000� Current portion of long-term debt 123,219� 155,919�
Accounts payable 4,538,569� 3,243,675� Accrued payroll and payroll
related expenses 1,449,185� 1,502,681� Other accrued expenses
2,405,447� 1,903,130� Accrued contract losses �� 84,779� Accrued
restructuring costs 1,200,326� �� Current portion of senior secured
convertible notes 2,799,684� �� Current portion of investor and
placement agent warrant liability 436,919� �� Deferred revenue
5,834,537� 2,359,672� Total current liabilities $18,787,886�
$11,249,856� � Redeemable convertible Series B preferred stock (345
shares issued and outstanding at December 31, 2006 and 2005,
respectively; face value $5,000 per share; liquidation preference
100%) � 1,725,000� � 2,125,000� Long-term debt, net of current
portion �� 117,715� Long-term Senior secured convertible notes, net
of current portion 9,940,798� �� Long-term warrant liability, net
of current portion 2,483,634� �� Other long-term liabilities
108,049� 334,435� Total Liabilities $33,045,367� $13,827,006� �
Stockholders' equity: Common stock; $0.01 par value, 100,000,000
and 50,000,000 shares authorized; 40,105,073 and 38,382,706 shares
issued and outstanding at December 31, 2006 and 2005, respectively
� 401,051� 383,827� Additional paid-in capital 156,379,193�
153,450,771� Accumulated deficit (158,991,838) (139,213,827)
Accumulated other comprehensive loss (256,486) (119,702) Total
stockholders' equity (deficit) $(2,468,080) $14,501,069� Total
liabilities and stockholders' equity 30,577,287� $28,328,075�
SATCON TECHNOLOGY CORPORATION CONSOLIDATED STATEMENTS OF OPERATIONS
� Three months ended Year Ended December 31, 2006 December 31, 2005
December 31, 2006 December 31, 2005 � Revenue: Product revenue $
8,021,314� $ 6,038,029� $ 28,766,647� $ 27,659,409� Funded research
and development and other revenue 1,533,949� 1,079,052� 4,990,022�
6,229,695� Total revenue 9,555,263� 7,117,081� 33,756,669�
33,889,104� Cost of product revenue 8,038,557� 5,801,833�
27,823,402� 26,214,318� Selling, general and administrative
expenses 3,356,294� 2,487,852� 13,007,946� 10,767,768� Research and
development expenses: Funded research and development expenses
839,487� 1,111,102� 4,041,137� 5,775,773� Unfunded research and
development expenses 405,297� 260,396� 2,000,271� 728,283� Total
research and development expenses 1,244,784� 1,371,498� 6,041,408�
6,504,056� Amortization of intangibles 109,823� 111,671� 430,959�
446,684� Gain on sale of assets -� (1,442,915) (399,015)
(1,760,717) Restructuring Costs 1,350,045� -� 1,612,045� -�
Write-off of impaired long-lived assets -� -� -� 1,190,436� � � � �
� Total operating expenses 14,099,503� 8,329,939� 48,516,745�
43,362,545� Operating income/(loss) (4,544,240) (1,212,858)
(14,760,076) (9,473,441) Net unrealized gain/(loss) on warrants to
purchase common stock -� -� -� (28,975) Other income/(expense)
(591,748) (4,397) (4,251,165) (102,963) Interest income 109,636�
47,098� 384,394� 87,189� Interest expense (448,182) (137,570)
(1,151,164) (603,204) Net income/(loss) $ (5,474,534) $ (1,307,727)
$ (19,778,011) $ (10,121,394) Net income/(loss) attributable to
common stockholders' $ (5,474,534) $ (1,307,727) $ (19,778,011) $
(10,121,394) Net income/(loss) per weighted average share, basic
and diluted $ (0.14) $ (0.03) $ (0.50) $ (0.29) Weighted average
number of common shares, basic and diluted 40,002,167� 38,355,974�
39,290,167� 35,209,936�
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