Axion Power International Inc. reported results for its third quarter and nine months ended September 30, 2009. Sales for the third quarter were $962,833 compared to $149,441 during last year’s third quarter, an increase of 544%. The loss for the third quarter was $17.2 million compared to $2.2 million in the third quarter of 2008. The current loss includes a non-cash loss of $12,048,203 due to SEC mandated changes that went into effect in 2009 that require down rounding for certain derivative securities. It also includes a non-cash loss of $3,302,428 for beneficial conversion features of the company’s preferred stock. On a cash expense basis, operating expense declined in the third quarter of 2009 compared with the same period in 2008.
For the first nine months of 2009, sales were $1.6 million, compared to $541,298 for the prior year’s first nine months, an increase of 190%. Net loss for the first nine months of 2009 was $23.5 million compared to a net loss of $8.3 million for the first nine months of 2008. The nine month totals include a non-cash loss of $13,592,717 for down rounding of certain derivative securities and $3,871,570 in non-cash expense for beneficial conversion features of the company’s preferred stock. On a cash expense basis, operating expense for the first nine months of 2009 declined 19% when compared to the same nine month period for 2008.
During the third quarter, the company completed an initial phase in its four-year global supply agreement with Exide Technologies. Axion will supply PbC® batteries and other Axion Technology™ to Exide under the supply agreement. The two companies have jointly established specifications and test protocols for Axion’s lead-carbon product that will be manufactured for multiple markets including hybrid vehicles, defense applications, utility and industrial energy storage as well as renewable power such as wind and solar. Monthly shipments of PbC® batteries began in September and will continue in accordance with the Exide contract.
In August, the U.S. Department of Energy (DOE) announced a $34.3 million stimulus award to "Exide Technologies with Axion Power International" for the development of lead carbon technology for micro-hybrid and mild-hybrid vehicle applications and for other potential storage applications.
The company closed on a 3% loan from the Machinery and Equipment Loan Fund under Pennsylvania’s Department of Community Development in the maximum amount of $791,055.
The company continues to market the Power Cube™ for various storage and power applications and has several open proposals. Subsequent to the end of the third quarter, Axion received its first purchase order in the oil rig market. An initial Power Cube will be provided that will reduce the oil rigs fuel consumption by up to 20%, provide backup power protection and be capable of powering the rig in certain applications. Delivery will be made in the fourth quarter of 2009.
"We are making important progress on a number of fronts, especially in the emerging hybrid vehicle market; in our relationships with our strategic partners; and in ramping up our production capacities at our New Castle facility," said Axion Power CEO Thomas Granville. "Our advanced lead-carbon electrode design, the cornerstone of our proprietary PbC battery product, is receiving increased recognition for its many advantages over other advanced battery technologies, including its substantially lower cost, ability to deliver power and be quickly recharged, its ease of manufacture and its already established recycling infrastructure. We believe the DOE grant recognition is yet another substantial validation of our PbC technology."
