Millennium Cell Inc. (Eatontown, NJ), a developer of hydrogen battery technology, reported a net loss for the quarter ended September 30, 2005, of $3.4 million, or $0.08 per share, as compared to $2.3 million, or $0.06 per share, in the same period of 2004. The increase in net loss is attributable to non-cash interest expense incurred to convert a substantial portion of convertible instruments during the third quarter. In addition, professional fees increased over the same quarter in the prior year. The results were within expectations for the third quarter.
The company made several improvements to its balance sheet during the quarter. Firstly, nearly half of the $10 million of Series C Preferred Stock, issued in April 2005, were converted into common stock. Secondly, the remaining $1.0 million of unsecured debentures were converted into common stock. Lastly, Ballard Power Systems Inc. sold $2.4 million of Millennium Cell's secured debentures to a group of accredited institutional investors. Millennium Cell, and the new holders of the debentures, are currently working to modify the terms of the secured debentures with the goal of releasing the restricted cash for use in operations.
"Actions taken by Millennium Cell and by major stockholders this quarter have dramatically improved the health of our balance sheet," stated Millennium Cell Chief Financial Officer John Giolli. We are pleased to report this activity and look forward to continuing to meet our business objectives in a fiscally responsible manner."
