WALTHAM, Mass., May 11,
2016 /PRNewswire/ -- Tecogen® Inc. (NASDAQ: TGEN),
a manufacturer and installer of high efficiency, ultra-clean
combined heat and power products including natural gas
engine-driven cogeneration, air conditioning systems, and
high-efficiency water heaters for industrial and commercial use,
reported revenues of $5,075,515 for
the quarter ended March 31, 2016 compared to $6,103,434 for the same period in 2015, a
decrease of 17%. Recent challenging market conditions carried
through into the first quarter from the back half of last year and
were not helped by a temporary delay of incentive programs in
New Jersey for CHP and
New York for chillers.
Gross profit was $1,719,344 for
the quarter ended March 31, 2016 compared to $2,224,975, a decrease of 23% over the prior
year. On a combined basis, operating expense fell to
$2,626,210 for the first quarter 2016
from $2,844,584 in the first quarter
of 2015, a 7.7% improvement and in line with management's goal to
deliver full year operating expense near $10
million.
Revenue results were helped by 9.5% growth in services related
revenues over the prior year period that was more than offset by a
decline in product sales. Total service revenue growth benefited
from increasing penetration in service contracts and favorable
operating metrics for the installed fleet. This positive
services momentum was partially offset by a decline in installation
related revenues as project delays continued in a number of key
markets. Conversely, product sales revenues suffered in the
period, posting a decline over the prior year comparable quarter of
36%. This decline in total product revenue was impacted by a
12.2% decline in chiller and heat pump sales as well as a decline
in cogeneration sales.
Speaking about the quarter, co-Chief Executive Officer
Benjamin Locke noted, "Through
disciplined control of operating expenses and product cost, we are
setting the stage for improved margins as we continue our existing
sales of CHP systems, heat pumps, and chillers. Also, our new
InVerde e+ that launched this spring is helping reestablish our
unique advantage in the New York
City marketplace, and our partnership with a gas company is
already leading to excellent Ilios projects being developed.
We believe all of these developments represent compelling new
initiatives to drive growth and shareholder value in the years to
come. Longer term, we expect the continued tightening of emissions
regulations across the country (similar to the strict standards we
have today in Southern California)
will grant out Ultera-equipped technology significant competitive
advantage."
Major Highlights:
Financial
- Gross margin in the first quarter 2016 decreased to 33.9%
compared to 36.5% in 2015. Margins benefited from continued
product-related cost control initiatives but this progress was more
than offset by a decline in service margins. Service margins
were impacted by a cost-overrun related to a single legacy
installation project; processes are in place to prevent such
overruns in the future.
- Gross profit for the first quarter of 2016 was $1,719,344 compared to $2,224,975, a 20% decline when compared to the
same period in 2015.
- General & administrative expense fell 13.0% to $1,892,220 for the quarter compared to
$2,174,747 in the prior year period
ended March 31, 2015. This
improvement is a demonstration of management's disciplined expense
control and effectiveness of the operating efficiency program.
- On a combined basis, operating expense fell to $2,626,210 for the first quarter 2016 from
$2,844,584 in the first quarter of
2015, a 7.7% improvement and in line with management's goal to
deliver full year operating expense near $10
million.
- Consolidated net loss, attributable to Tecogen, for the three
months ended March 31, 2016 was $893,168 compared to $617,464 for the same period in 2015.
- Net loss per share was $0.05 and
$0.04 for the three months ended
March 31, 2016 and 2015, respectively.
Sales & Operations
- Current sales backlog of equipment and installations as of
Friday May 6, 2016 was $13.1 million. In line with the Company's
goal of consistently delivering quarter-end product backlog greater
than $10 million. For the quarter
ended March 31, 2016, backlog was
$11.5 million, significant growth
over the $10.9 million in backlog
reported at the same time last year.
- InVerde e+ launched with many notable features unique to
Tecogen including rapid emergency power blackstart capability, best
in class electrical efficiency, and seamless integration capability
with battery or renewable power systems.
- Executed an agreement with a regional gas company to sell
Tecogen chillers and heat pumps exclusively via the gas company
partner in their territory, delivering strong synergies for both
the gas company and Tecogen.
- As a result of rigorous engineering and site analysis work by
the Tecogen team, we won a 900 kW multi-unit order worth
approximately $2 million from a large
international engineering company. The equipment is intended
for installation in various locations throughout a Long Island school district and includes
engineered accessories, load modules and a long term service
agreements.
- Emissions development progress continued with the completion of
phase one testing of the Ultera technology by AVL's California
Technology Center.
- Roll out began for Tecogen's new remote real time monitoring
solution, powered by GE Equipment Insight, with the
technology installed and running on the first machines. Our
technology department also completed the launch of the mobile app
for use by the service team and is receiving excellent feed-back to
date.
- Although down on a year-on-year basis, product revenue posted
10% growth over the previous quarter ended December 31, 2015. Product revenue was
helped by a pick-up in cogeneration product sales and a significant
improvement in chiller sales over the prior quarter.
Conference Call Scheduled for Today at 11:00 am ET
Tecogen will host a conference
call today to discuss the first quarter results beginning at
11:00 am eastern time. To
listen to the call dial (888) 349-0103 within the U.S., (855)
669-9657 from Canada, or (412)
902-0129 from other international locations. Participants
should ask to be joined to the Tecogen Inc. call. Please
begin dialing at least 10 minutes before the scheduled starting
time. The earnings press release will be available on the Company
website at www.Tecogen.com in the "News and Events" section under
"About Us." The conference call will be recorded and
available for playback one hour after the end of the call.
The earnings conference call will also be webcast live. To view the
associated slides, register for and listen to the webcast, go to
http://investors.tecogen.com/webcast. Following the call, the
webcast will be archived for 30 days.
The earnings conference call will be recorded and available for
playback one hour after the end of the call through Wednesday, May 18th, 2016. To
listen to the playback, dial (877) 344 7529 within the U.S.,
(855) 669-9658 from Canada, or
(412) 317-0088 outside the U.S. and use Replay Access
Code 10084852. Following the call, the webcast will be
archived for 30 days.
About Tecogen
Tecogen manufactures, installs, and
maintains high efficiency, ultra-clean, combined heat and power
products including natural gas engine-driven cogeneration, air
conditioning systems, and high-efficiency water heaters for
residential, commercial, recreational and industrial use. The
company is known for cost efficient, environmentally friendly and
reliable products for energy production that, through patented
technology, nearly eliminate criteria pollutants and significantly
reduce a customer's carbon footprint.
In business for over 20 years, Tecogen has shipped more than
2,300 units, supported by an established network of engineering,
sales, and service personnel across the
United States. For more information, please visit
www.tecogen.com.
Forward Looking Statements
This press release contains
forward-looking statements under the Private Securities Litigation
Reform Act of 1995 that involve a number of risks and
uncertainties. Important factors could cause actual results
to differ materially from those indicated by such forward-looking
statements, as disclosed on the Company's website and in Securities
and Exchange Commission filings. The statements in this press
release are made as of the date of this press release, even if
subsequently made available by the Company on its website or
otherwise. The Company does not assume any obligation to
update the forward-looking statements provided to reflect events
that occur or circumstances that exist after the date on which they
were made.
Tecogen Media
& Investor Relations Contact Information:
|
Ariel F. Babcock, CFA
|
John N.
Hatsopoulos
|
P: (781)
466-6413
|
P:
781-622-1120
|
E:
Ariel.Babcock@tecogen.com
|
E:
John.Hatsopoulos@tecogen.com
|
TECOGEN
INC.
|
CONDENSED
CONSOLIDATED BALANCE SHEETS
|
As of March 31,
2016 and December 31, 2015
|
(unaudited)
|
|
|
March 31,
2016
|
|
December 31,
2015
|
ASSETS
|
|
|
|
Current
assets:
|
|
|
|
Cash and cash
equivalents
|
$
|
4,253,931
|
|
|
$
|
5,486,526
|
|
Short-term
investments
|
294,875
|
|
|
294,802
|
|
Accounts receivable,
net
|
5,888,310
|
|
|
5,286,863
|
|
Unbilled
revenue
|
859,270
|
|
|
1,072,391
|
|
Inventory,
net
|
5,301,532
|
|
|
5,683,043
|
|
Due from related
party
|
594,599
|
|
|
1,177,261
|
|
Prepaid and other
current assets
|
354,891
|
|
|
353,105
|
|
Total current
assets
|
17,547,408
|
|
|
19,353,991
|
|
Property, plant and
equipment, net
|
549,319
|
|
|
543,754
|
|
Intangible assets,
net
|
1,048,280
|
|
|
1,044,611
|
|
Goodwill
|
40,870
|
|
|
40,870
|
|
Other
assets
|
58,425
|
|
|
58,425
|
|
TOTAL
ASSETS
|
$
|
19,244,302
|
|
|
$
|
21,041,651
|
|
|
|
|
|
LIABILITIES AND
STOCKHOLDERS' EQUITY
|
|
|
|
Current
liabilities:
|
|
|
|
Accounts
payable
|
$
|
2,377,211
|
|
|
$
|
3,311,809
|
|
Accrued
expenses
|
1,079,969
|
|
|
1,066,860
|
|
Deferred
revenue
|
984,239
|
|
|
996,941
|
|
Total current
liabilities
|
4,441,419
|
|
|
5,375,610
|
|
Long-term
liabilities:
|
|
|
|
Deferred revenue, net
of current portion
|
322,885
|
|
|
273,162
|
|
Senior convertible
promissory note, related party
|
2,963,393
|
|
|
2,951,011
|
|
Total
liabilities
|
7,727,697
|
|
|
8,599,783
|
|
Commitments and
contingencies (Note 6)
|
|
|
|
|
|
|
|
Stockholders'
equity:
|
|
|
|
Tecogen Inc.
stockholders' equity:
|
|
|
|
Common stock, $0.001
par value; 100,000,000 shares authorized; 18,478,990 issued and
outstanding at March 31, 2016 and December 31, 2015
|
18,479
|
|
|
18,479
|
|
Additional paid-in
capital
|
34,522,237
|
|
|
34,501,640
|
|
Accumulated
deficit
|
(22,575,605)
|
|
|
(21,682,437)
|
|
Total Tecogen Inc.
stockholders' equity
|
11,965,111
|
|
|
12,837,682
|
|
Noncontrolling
interest
|
(448,506)
|
|
|
(395,814)
|
|
Total stockholders'
equity
|
11,516,605
|
|
|
12,441,868
|
|
TOTAL LIABILITIES
AND STOCKHOLDERS' EQUITY
|
$
|
19,244,302
|
|
|
$
|
21,041,651
|
|
TECOGEN
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF OPERATIONS
|
For the three months
ended March 31, 2016 and 2015
|
(unaudited)
|
|
|
Three months ended
March 31,
|
|
2016
|
|
2015
|
Revenues
|
|
|
|
Products
|
$
|
2,266,148
|
|
|
$
|
3,537,875
|
|
Services
|
2,809,367
|
|
|
2,565,559
|
|
Total
revenues
|
5,075,515
|
|
|
6,103,434
|
|
Cost of
sales
|
|
|
|
Products
|
1,552,716
|
|
|
2,553,638
|
|
Services
|
1,803,455
|
|
|
1,324,821
|
|
Total cost of
sales
|
3,356,171
|
|
|
3,878,459
|
|
Gross
profit
|
1,719,344
|
|
|
2,224,975
|
|
Operating
expenses
|
|
|
|
General and
administrative
|
1,892,220
|
|
|
2,174,747
|
|
Selling
|
515,032
|
|
|
493,674
|
|
Research and
development
|
218,958
|
|
|
176,163
|
|
Total operating
expenses
|
2,626,210
|
|
|
2,844,584
|
|
Loss from
operations
|
(906,866)
|
|
|
(619,609)
|
|
Other income
(expense)
|
|
|
|
Interest and other
income
|
2,891
|
|
|
9,103
|
|
Interest
expense
|
(42,381)
|
|
|
(42,441)
|
|
Total other expense,
net
|
(39,490)
|
|
|
(33,338)
|
|
Loss before income
taxes
|
(946,356)
|
|
|
(652,947)
|
|
Consolidated net
loss
|
(946,356)
|
|
|
(652,947)
|
|
Less: Loss
attributable to the noncontrolling interest
|
53,188
|
|
|
35,483
|
|
Net loss attributable
to Tecogen Inc.
|
$
|
(893,168)
|
|
|
$
|
(617,464)
|
|
Net loss per share -
basic and diluted
|
$
|
(0.05)
|
|
|
$
|
(0.04)
|
|
Weighted average
shares outstanding - basic and diluted
|
18,478,990
|
|
|
16,224,642
|
|
TECOGEN
INC.
|
CONDENSED
CONSOLIDATED STATEMENTS OF CASH FLOWS
|
For the three months
ended March 31, 2016 and 2015
|
(unaudited)
|
|
|
March 31,
|
|
2016
|
|
2015
|
CASH FLOWS FROM
OPERATING ACTIVITIES:
|
|
|
|
Consolidated net
loss
|
$
|
(946,356)
|
|
|
$
|
(652,947)
|
|
Adjustments to
reconcile net loss to net cash used in operating
activities:
|
|
|
|
Depreciation and
amortization
|
65,456
|
|
|
67,239
|
|
Provision for
inventory reserve
|
14,000
|
|
|
(40,000)
|
|
Stock-based
compensation
|
27,243
|
|
|
93,254
|
|
Non-cash interest
expense
|
12,382
|
|
|
12,383
|
|
Gain (loss) on sale
of assets
|
640
|
|
|
(5,569)
|
|
Provision for losses
on accounts receivable
|
(6,154)
|
|
|
—
|
|
Changes in
operating assets and liabilities
|
|
|
|
(Increase) decrease
in:
|
|
|
|
Short term
investments
|
(73)
|
|
|
(353)
|
|
Accounts
receivable
|
(595,293)
|
|
|
(659,607)
|
|
Unbilled
revenue
|
213,121
|
|
|
(153,905)
|
|
Inventory,
net
|
367,511
|
|
|
374,069
|
|
Due from related
party
|
582,662
|
|
|
327,843
|
|
Prepaid expenses and
other current assets
|
(1,786)
|
|
|
(53,163)
|
|
Increase (decrease)
in:
|
|
|
|
Accounts
payable
|
(934,598)
|
|
|
681,160
|
|
Accrued
expenses
|
13,109
|
|
|
270,174
|
|
Deferred
revenue
|
37,021
|
|
|
(765,124)
|
|
Net cash used in
operating activities
|
(1,151,115)
|
|
|
(504,546)
|
|
CASH FLOWS FROM
INVESTING ACTIVITIES:
|
|
|
|
Purchases of property
and equipment
|
(47,371)
|
|
|
(12,935)
|
|
Proceeds from sale of
assets
|
—
|
|
|
5,569
|
|
Purchases of
intangible assets
|
(27,959)
|
|
|
(47,237)
|
|
Net cash used in
investing activities
|
(75,330)
|
|
|
(54,603)
|
|
CASH FLOWS FROM
FINANCING ACTIVITIES:
|
|
|
|
Payment of stock
issuance costs
|
(6,150)
|
|
|
—
|
|
Proceeds from sale of
restricted common stock, net
|
—
|
|
|
996,874
|
|
Proceeds from the
exercise of stock options
|
—
|
|
|
360,225
|
|
Net cash provided by
(used in) financing activities
|
(6,150)
|
|
|
1,357,099
|
|
Net increase
(decrease) in cash and cash equivalents
|
(1,232,595)
|
|
|
797,950
|
|
Cash and cash
equivalents, beginning of the period
|
5,486,526
|
|
|
1,186,033
|
|
Cash and cash
equivalents, end of the period
|
$
|
4,253,931
|
|
|
$
|
1,983,983
|
|
Supplemental
disclosures of cash flows information:
|
|
|
|
Cash paid for
interest
|
$
|
29,999
|
|
|
$
|
30,059
|
|
To view the original version on PR Newswire,
visit:http://www.prnewswire.com/news-releases/tecogen-announces-first-quarter-2016-results-300266762.html
SOURCE Tecogen Inc.