Active Power Announces First Quarter 2008 Results; Renews OEM Agreement With Caterpillar
Active Power, Inc. announced results for its first quarter ended March 31, 2008. Revenue for the first quarter was $7.5 million, a 26% increase from the same period last year and a decrease of 26% from the previous quarter. Net loss for the quarter was $4.5 million, or 7 cents per share, compared to a net loss of $6.4 million, or 13 cents per share, for the same period last year. For the previous quarter, net loss was $5.9 million, or 10 cents per share.
Active Power reported a gross profit margin of 10% compared to 6% in the same period last year and negative 2% in the previous quarter. The change in cash and investments during the quarter was $5.1 million compared to a change in cash and investments of $3.7 million in the same period last year and a change of $0.3 million in the previous quarter. Cash and investments on March 31, 2008, were $17.4 million.
"We continue to achieve increasing revenues and shrinking losses on a year-over-year basis," said Jim Clishem, President and CEO of Active Power. "The quarter came in slightly below our expectations; however, we are confident in the long term prospects for the business. Our funnel is consistently growing and we have seen increased interest in large systems and containerized solutions. These project based opportunities have longer sales cycles, which impacted sales in Africa and Southern Europe in particular this quarter. Many of our expenses are planned in anticipation of revenue. As a result, our use of cash and investments for the quarter were higher than previously guided."
The company also announced that it has renewed its global distribution agreement with its largest OEM partner and customer Caterpillar, Inc.. The new three-year contract contains substantially similar terms and conditions to the previous agreement with enhancements to reflect new products, operational processes and pricing. As part of the distribution agreement, Caterpillar will continue to market Active Power products under the Caterpillar brand and as a complement to its own product line.
An initial agreement with Caterpillar was signed in 1999 to develop and market a fully integrated flywheel based UPS system. These UPS systems were designed and manufactured to Caterpillar specifications based on Active Power’s patented flywheel technology. In August 2000, Active Power signed a multi-year worldwide distribution agreement with Caterpillar, allowing the company to market Active Power’s CleanSource® UPS solution under the ‘CAT UPS’ brand name. Sales to Caterpillar continued to climb and in 2007 revenue from Caterpillar and its dealer network represented 31% of Active Power’s total revenue. In the fourth quarter of 2007, Active Power announced a significant single 8MW order via Caterpillar for a preeminent name brand global data center operator.
