Beacon Power Corp. announced its financial results for the first quarter ended March 31, 2008. For the first quarter of 2008, Beacon Power reported revenue of $20,000 and a net loss of $5,287,000, or ($0.06) per share, compared to revenue of $393,000 and a net loss of $3,090,000, or ($0.05) per share, in the first quarter of 2007.
The decrease in revenue is said to be the result of completion of development contracts with both California and New York as well as the Department of Energy in 2007. Beacon Power is now entering the production phase and expects to have commercial revenues from its frequency regulation facilities in the fourth quarter of 2008.
During the first quarter of 2008, Beacon Power incurred costs of $3,032,000 for research and development expense, compared to $1,660,000 in the first quarter of 2007, an increase of $1,372,000 or 83%. Research and development expense increased primarily due to the expensing of development costs that had been allocated to government contracts in the prior year, increased headcount-related costs, development and design costs for our frequency regulation facilities, and increased expenses for legal and professional services. Selling, general and administrative expense was $2,176,000 during the first quarter of 2008, compared to $1,414,000 in the first quarter of 2007, an increase of $762,000, or approximately 54%. The increase is said to be due primarily to increased headcount-related costs as well as increased external fees related to consulting, legal, marketing and other services to facilitate penetration into the frequency regulation markets. Additionally, depreciation expense increased by $254,000 compared to the first quarter of 2007. This increase is said to be primarily related to the company’s new facility in Tyngsboro, Massachusetts.
At March 31, 2008, the company had $25.0 million in cash and cash equivalents, with working capital of $23.1 million. In the fourth quarter of 2008, the company anticipates receiving revenue from its first commercial frequency regulation facility, which will likely be in New York, as well as from a second plant either in New England (at its Tyngsboro site) or the PJM Interconnection. The company has an option to purchase approximately seven acres of land in Stephentown, NY, and is awaiting the expected approval of a land-use permit it has applied for from that town, as well the approval of an active interconnection request by NYISO. As referenced above, Beacon has initiated the process of establishing up to 5MW of frequency regulation capacity on its Tyngsboro site, and two more potential locations are being actively pursued in the PJM region.
