SatCon Technology Reports Year-End Financial Results for 2006
SatCon Technology Corp. announced its operating results for the quarter and year ended December 31, 2006. Revenues for the year ended December 31, 2006 were comparable to prior year revenues of $33.8 million. Revenues in the Stationary Power Systems business grew 44% to $14.2 million with an increase in alternative energy products of 74% to $10.6 million compared to $6.1 million in 2005 and the Electronics business grew 10% to $10.2 million, offset by revenue decreases associated with the sale of non-strategic product lines.
The company states that this revenue shift reflects its effort to focus on higher margin products and products targeted at the alternative energy and distributed power markets. This is also consistent with the company’s recently announced strategic collaboration with International Master Technologies I+Tec to establish a SatCon presence in Spain to serve the expanding European alternative energy market.
The company also claims that this shift can be further seen in the order backlog, which is at an all-time high of $35 million, up 60% compared with this same time a year ago. Orders on hand in its Stationary Power Systems business were $16 million, an increase of over 100%, compared with $8 million a year ago. The renewable energy portion of that backlog is approximately $5 million, compared to just over $2 million one year ago. This growth in renewable energy revenue from $6.1 in 2005 to $10.6 million in 2006 and in backlog orders of approximately $8 million are indicative of the success the company claims it is having with its shift in focus on its power management and system architecture solutions for the alternative energy and distributed power markets.
Operating loss for the year ended December 31, 2006 increased to $14.8 million compared with an operating loss of $9.5 million for the same period in 2005. The primary differences were a one-time gain of $1.4 million on the sale of the company’s Shaker product line in 2005, a non-cash stock based compensation charge of approximately $1.0 million, and an increase in its investments in R&D and SG&A of approximately $2.6 million. These R&D and SG&A investments were steps taken to drive the strategic shift in the business for future revenue growth, which the company began to realize in 2006 in its Stationary Power Systems business.
Operating loss for the quarter was $4.5 million, compared with an operating loss of $1.2 million in 2005. Net loss for the year ended December 31, 2006 was $20.0 million, or $0.51 per share, compared with a net loss of $10.1 million, or $0.29 per share, for the same period in 2005. A major contributor to the increase in net loss for both the quarter and year to date (as compared with the prior periods in 2005) were non-cash charges of over $4.4 million associated with the valuation of the company’s Senior Convertible Secured Notes and warrants and the related derivatives and other investment spending.