ZBB Energy Product Sales Soar 10X, Profits Still Lagging

February 14, 2013 by Jeff Shepard

ZBB Energy Corporation announced financial results for the second quarter ended December 31, 2012 as compared to the second quarter ended December 31, 2011 included: product sales increased more than ten times from $240,921 to $2,748,007. Gross profits on product sales were $482,801. Gross margins on product sales increased from 7% last quarter to 18% this quarter. Total revenues, including engineering and development revenue, increased more than five times from $440,921 to $2,748,007. Net loss of $3,083,457 compared to $2,730,310. The increase in net loss is due primarily to the increase in equity from the loss of an investee company (China joint venture). Loss per share decreased to ($0.04) from ($0.08).

As of February 13, 2013, the Company's backlog was $6.1 million compared to backlog of $5.3 million on November 5, 2012. ZBB ended the second quarter of fiscal year 2013 with total assets of $17.0 million including $2.4 million in cash and $1.2 million in accounts receivable. Anticipated collections in the third and fourth quarters of this fiscal year associated with current backlog and current accounts receivable is approximately $4.3 million. Operating expenses plus additional inventory purchases for current backlog continue at approximately $1.4 million per month with the Company actively reducing non-essential cash expenses.

The Company is aggressively pursuing additional sales orders and other sources of funding including expansion of contract engineering and development programs through strategic partners. Sufficient cash and working capital through fiscal year 2013 fourth quarter depends on securing additional investment capital or other financing, which may include: collaboration agreements and/or investments from strategic partner/partners, or other financing alternatives.

The company also reported for the six month period ending December 31, 2012 compared to the six months ended December 31, 2011: Revenues increased 120% to $4,571,328 from $2,078,778. Total costs and expenses increased 57% to $10,313,458 from $6,540,596. Net loss increased 35% to $5,966,247 from $4,405,758. And loss per share declined to ($0.08) from ($0.14).