Mechanical Technology Inc. ("MTI") announced its financial results for the quarter ended March 31, 2008. MTI also announced that its subsidiary MTI Micro delivered a Mobion® power source prototype to a global Japanese consumer electronics company under a development agreement entered into earlier this month.
"We have made significant progress since the start of the year," said Peng Lim, CEO of MTI. "At MTI Micro, we launched a developmental pilot production line for Mobion, signed an agreement with a global Japanese consumer electronics company and developed and demonstrated three different Mobion prototypes at global conferences and meetings – an external charging device, a power accessory attached to a digital camera and an embedded fuel cell-powered GPS device – all to help prepare for the planned launch of an initial Mobion product in 2009. At MTI Instruments, we achieved a 16% increase in revenue."
Revenue for the three months ended March 31, 2008 increased 7.0% to $2.2 million compared to revenue of $2.3 million for the same period in 2007. First quarter revenue included $2.0 million in product revenue from MTI Instruments and $173,000 in funded R&D revenue from MTI Micro. During the first quarter of 2008, product revenue increased $279,000, or 16.4%, reflecting sales increases in MTI Instruments’ aviation product line – in particular commercial aviation sales – coupled with smaller sales increases in semiconductor and general dimensional gauging products. Funded R&D revenue decreased $442,000, or 71.9%, with $418,000 of the decrease attributable to the completion of the SAFT contract during the first quarter of 2007. Revenue from MTI Micro’s contract with the DOE increased by $170,000 but was offset by a revenue decrease of $194,000 attributable to the conclusion of a strategic alliance agreement in July 2007.
Net loss for the three months ended March 31, 2008 of $3.2 million, or $0.08 per diluted share, was consistent with the net loss for the three months ended March 31, 2007. Net loss for the first quarter of 2008 compared to 2007 includes the effects of positive and negative revenue and expense changes. These changes include increases in gross margins on product sales, decreases in funded R&D revenue, cost savings in R&D spending, an increase in Selling, General and Administrative expenses, a decrease in gain on derivatives and a decrease in the income effects of minority interest shareholders. The R&D cost savings were primarily the result of savings derived from the first quarter 2007 decision to suspend efforts on MTI Micro’s high power program. Gross margin percentages on product sales for the three months ended March 31, 2008, remained consistent with the comparable period in 2007.
