8.11.2006: Meldung: Distributed Energy Systems Corp.: 3rd Quarter Revenues
Company Expects Strong 2006 Finish with Growing Backlog
WALLINGFORD, Conn., Nov. 7 / Distributed Energy Systems Corp., which serves the energy marketplace by giving users greater control over the cost, quality and reliability of electric power, today reported that revenues for the third quarter of 2006 were a record $14.8 million, up 20% from 2005"s third quarter revenues of $12.3 million.
For the third quarter ended September 30, 2006, the company posted a net loss of $6.3 million, or $0.16 per share, including approximately $0.03 per share attributable to required compliance with Statement of Financial Accounting Standard 123(R), which took effect in 2006. One year ago, Distributed Energy reported a third-quarter net loss of $3.6 million, or $0.10 per share.
"Results for the third quarter represented another step forward this year," said Ambrose L. Schwallie, Distributed Energy"s chief executive officer. "As the year progressed, business improved throughout the company, and we expect the fourth quarter to be stronger than the third quarter, and to continue building our backlog as we enter 2007." Distributed Energy"s current backlog is approximately $40 million, about 20% higher than the $33 million the company reported in early August.
Mr. Schwallie noted that the company"s two businesses -- Northern Power"s energy systems, products and services and Proton"s commercial hydrogen products and its pioneering Hydrogen Technology Group -- posted increases in revenues and quarter-over-prior-quarter improvements during 2006.
"There has been a steadily improving pace of customer inquiries, paid engineering studies and signed contracts for major engineering, procurement and construction assignments, as well for our product and service offerings. September was an exceptionally strong month, and that trend continues into the fourth quarter," Mr. Schwallie noted.
He cited a $2.1 million contract, announced in October, from Consolidated Edison Company of New York, to supply advanced power converters that will enable the utility, for the first time, to rapidly deploy and connect megawatt-scale generators to its distribution grid and provide power during emergencies. In addition, the company benefited from Pathmark Stores Inc. qualifying for and receiving State of New Jersey renewable energy funding for an engineering services contract that had been pending with Northern Power since March.
Discussing Distributed Energy"s commercial hydrogen business, Mr. Schwallie noted that booking and revenue trends made incremental progress during the year. "Proton"s on-site HOGEN(R) hydrogen and StableFlow(TM) control systems continue to live up to reliability expectations in the field, and they also enable customers to produce more electricity from less fuel. That enables us to market these advanced products and systems more aggressively, including via lease financing, because they are proven to be highly cost-effective, self-liquidating investments for power generating companies in the U.S. and around the world."
"At the same time, our advanced intellectual property and know-how in state-of-the-art hydrogen technology for back-up power, aerospace and fuel- cell-related transportation applications are at the core of a steady stream of recently awarded research and development projects for large, well-known energy companies and Federal government agencies," he pointed out.
Concluding his comments, Mr. Schwallie stated: "With the continuation of the positive trends in inquiries for new projects, product sales and service opportunities, we expect a strong finish to 2006, better margins going forward and a solid beginning to the new year. It also reflects a growing commitment by major companies and other organizations to embrace technologies and projects where we have expertise. Our systems and products enable them do a better -- and increasingly necessary -- job of managing and controlling the availability, reliability and cost of their energy resources."
Results for the third quarter ended September 30, 2006, include revenue recognition of $4.5 million previously deferred relating to the company"s HOGEN H-Series hydrogen generating system product line. In the third quarter of 2005, results also included recognition of $1.8 million of revenues previously deferred relating to its HOGEN S-Series product line. In both of these cases revenue was recognized when the company had sufficient warranty experience. The approximately $0.03 per share of the company"s $0.16 per share net loss this year"s third quarter was attributable to required compliance with the Statement of Financial Accounting Standard 123 (revised 2004), "share-based payment" or SFAS123(R) and other non-cash stock compensation charges. (The company adopted SFAS123(R) in the first quarter 2006 as required, and historical results do not include such charges.)
For the first nine months of 2006, the company reported revenue of $31.8 million, and a net loss of $20.2 million, or $0.53 per share. That figure includes approximately $0.12 per share attributable to compliance with SFAS123(R) and other non-cash stock compensation charges. One year ago, the company reported nine-month revenue of $34.0 million, and a net loss of $12.8 million, or $0.36 per share, including $0.01 per share attributable to non- cash stock compensation charges.
Cash, marketable securities and restricted cash as of September 30, 2006, totaled $27.9 million, compared with $41.7 million as of December 31, 2005. Cash use decreased during the third quarter to approximately $5.5 million. During the first nine months of 2006, cash, marketable securities, and restricted cash decreased by approximately $13.8 million, compared with $16.4 million for the same period a year ago, and reflect net losses and working capital requirements, offset by approximately $7.5 million raised under an equity distribution agreement in the second quarter of 2006. The company said it expects a further significant reduced need for cash during the fourth quarter of 2006. Working capital is defined as current assets minus current liabilities excluding cash and marketable securities.
About Distributed Energy Systems Corp.
Distributed Energy Systems Corp. (Nasdaq: DESC) creates and delivers products and solutions to the emerging decentralized energy marketplace, giving users greater control over their energy cost, quality and reliability. As the parent company of Proton Energy Systems (www.protonenergy.com) and Northern Power Systems (www.northernpower.com), Distributed Energy Systems delivers a combination of practical, ready-today energy solutions and the solid business platforms for capitalizing on the changing energy landscape. For more information visit www.distributed-energy.com.
SOURCE Distributed Energy Systems Corp.
/CONTACT: Amy Klinger of Distributed Energy Systems Corp.,
/Web site: http://www.distributed-energy.com