Energy Conversion Devices Reports Fourth Quarter & Fiscal Year 2010 Financial Results
Energy Conversion Devices, Inc. (ECD) announced financial results for its fourth quarter and fiscal year ended June 30, 2010. Total consolidated revenues for the quarter were $86.2 million, compared to $51.4 million in the fourth quarter of fiscal 2009, a 68% increase, and $72.4 million in the third quarter of fiscal 2010, a 19% increase. Solar product and system sales for the quarter were $81.3 million, compared to $46.0 million in the same quarter last year, a 77% increase, and $65.1 million in the third quarter of fiscal 2010, a 25% increase.
For the fourth quarter, the company reported a loss of $20.4 million or $0.48 per fully diluted share compared to a net loss of $17.6 million or $0.42 per fully diluted share in the year-ago period. This compares to a net loss of $26.8 million or $0.63 per fully diluted share in the third quarter of fiscal 2010, which excluded a non-cash impairment charge of $358.0 million or $8.46 per share.
The company reported an increase in cash, cash-equivalents and short-term investments of $7.4 million during the quarter, compared to a decrease of $38.3 million in the fourth quarter of fiscal 2009 and a decrease of $19.6 million in the third quarter of fiscal 2010. The company’s total reported cash position at the end of the fiscal year stood at $204.7 million, which includes $11.7 million of restricted cash.
Fourth quarter net results were negatively affected by the following items, which had an aggregate effect of $11.0 million: under-absorption of factory overhead costs of $6.2 million, a restructuring charge of $1.3 million, inventory reserves of $2.4 million and a net foreign currency transaction loss of $1.1 million. In addition, the company recognized a non-cash gain on the early extinguishment of debt of $4.3 million due to the exchange of $23 million par value of the company’s outstanding convertible notes for common stock. The net impact of these items was an increase of the quarter’s net loss by $6.7 million, or $0.16 per fully diluted share.
Mark Morelli, ECD’s President and Chief Executive Officer said, "Our fourth quarter results demonstrate solid progress. We have expanded shipments, reduced inventory, improved cash flow and increased revenue on a sequential basis. We remain aggressively focused on improving sales and margins and bringing our overall costs down. Our demand creation activities continue to gain traction as we have added 150 megawatts to our project pipeline."
For the fiscal year ended June 30, 2010, total consolidated revenues were $254.4 million compared to $316.3 million in the prior year. Solar product and system sales were $230.2 million for fiscal 2010 compared to solar product sales of $295.0 million in the prior year. Net loss for fiscal year 2010 was $456.0 million or $10.72 per fully diluted share versus net income of $8.5 million or $0.20 per fully diluted share in the year-ago period, as adjusted due to the implementation of FASB ASC 470-20. Fiscal year 2010’s net loss was impacted by several items including non-cash impairment charges of $359.2 million, restructuring charges of $4.7 million, transaction costs from the acquisition of Solar Integrated Technologies of $3.0 million, non-cash losses on asset disposals of $1.1 million, net foreign currency transaction losses of $2.4 million and the $4.3 million non-cash gain on the early extinguishment of debt described above. When taken collectively, these items increased fiscal year 2010’s net loss by $366.1 million or $8.61 per share.