Solar Integrated Merger Opens New Markets, Adds Capabilities to
Reduce Total Installed Costs; Company Maintains Strong Financial
Position ROCHESTER HILLS, Mich., Aug. 27 /PRNewswire-FirstCall/ --
Energy Conversion Devices, Inc. (ECD) (NASDAQ:ENER), the leading
global manufacturer of thin-film flexible solar laminate products
for the building integrated and commercial rooftop markets, today
announced financial results for its fourth quarter and fiscal year
ended June 30, 2009. Total consolidated revenues for the quarter
were $51.4 million compared to $82.4 million in the fourth quarter
of fiscal 2008 and $66.0 million in the third quarter of fiscal
2009. Solar product sales for the quarter were $46.0 million
compared to $77.0 million in the same quarter last year and $59.7
million in the third quarter of fiscal 2009. For the fourth
quarter, the company reported a loss of $15.8 million or a loss of
$0.37 per fully diluted share compared to a net income of $9.9
million or $0.24 per fully diluted share in the year-ago period.
This compares to net income of $1.3 million or $0.03 per fully
diluted share in the third quarter of fiscal 2009. For the fiscal
year ended June 30, 2009, total consolidated revenues were $316.3
million compared to $255.9 million in the prior year. Solar product
sales were $292.4 million for fiscal 2009 compared to $231.5
million for the prior year. Net income for fiscal 2009 was $12.5
million or $0.29 per fully diluted share versus net income of $3.9
million or $0.09 per fully diluted share in the year-ago period.
Net operating cash flow for fiscal 2009 was $11.1 million versus
$28.5 million during fiscal 2008. Mark Morelli, ECD's President and
Chief Executive Officer, said, "Demand for solar products in our
target markets weakened further from the third quarter into the
fourth quarter as commercial construction declined, building owners
deferred reroofing projects, and project financing constraints
continued. In response, we took deliberate steps to reduce our
production levels to better match anticipated demand and to
preserve strategically important capital at a time of capital
market uncertainty. We pulled back on production and expansion, and
reduced fixed and variable costs. These actions had a significant
impact on our operating income for the second half of our fiscal
year, but helped maintain positive full year cash flow." "We are
driving our demand creation activities in and beyond our core
building integrated photovoltaic markets. This is highlighted by
our acquisition of Solar Integrated Technologies (SIT) which
expands our capabilities in large projects and strengthens our
commercial team globally. SIT also enhances our ability to reduce
balance-of-system and installation costs, further improving our
competitive levelized cost of energy. Looking ahead, we are
cautiously encouraged by an overall uptick in market activity,
including a significant increase in the volume of projects on which
we are bidding. Overall, our demand-creation strategy and the
integration of SIT are key ingredients of our plan to return to
profitability," added Mr. Morelli. Fourth-quarter net results were
negatively impacted by $13.6 million of items, of which
approximately $8.8 million are non-cash charges. These include
unabsorbed overhead costs of $6.1 million ($0.14 per fully diluted
share) resulting from production cutbacks; restructuring costs of
$1.7 million ($0.04 per fully diluted share) resulting from the
previously announced consolidation of operations between the
company's Auburn Hills 1 and Auburn Hills 2 facilities and the
associated headcount reduction; a write down of an asset held for
sale of $1.2 million ($0.03 per fully diluted share); and other
costs of $4.6 million ($0.11 per fully diluted share) which
includes increases in reserves for bad debt and warranty and a
write-off of certain inventory. Fiscal Year 2010 Guidance The
company expects access to capital will continue to be a constraint
and average selling prices will remain under significant pressure
for the fiscal year. While there has been increased project
activity, U.S. Government stimulus spending and the company's
demand-creation initiatives for large and U.S. utility projects
will not drive a meaningful increase in revenues until the second
half of the fiscal year. Based on these assumptions, the company
believes revenues for the first fiscal quarter will be in line with
fourth quarter 2009 revenues. For the full fiscal year, revenues
are anticipated to be approximately 10-15% higher than in fiscal
year 2009. Production is expected to be about 150MW for the year,
with higher volumes in the second half. Interest expense is
expected to be $28 million for the year including $14 million
(noncash) related to the impact of FSP APB 14-1 regarding
accounting for convertible debt. Costs associated with the
acquisition of SIT will include transaction-related costs of
approximately $5 million and restructuring costs of approximately
$5 million. Conference Call / Webcast Details Management of Energy
Conversion Devices will review these financial results on a
conference call on Thursday, August 27, 2009, at 10:00 a.m. EDT.
The dial-in number for the live audio call is 877-858-2512 or
706-634-6076 (international) with conference ID number 25690028.
The conference call will be webcast live over the Internet and can
be accessed in the Investor Relations - Conference Calls section of
the company's website at http://www.energyconversiondevices.com/.
An audio replay of the call will be available approximately two
hours after the conclusion of the call. The audio replay will
remain available until 11:59 p.m., August 29, 2009, and can be
accessed by dialing 800-642-1687 or 706-645-9291 (international),
with conference ID number 25690028. The webcast will also be
archived on the company's website. About Energy Conversion Devices
Energy Conversion Devices is a leader in building integrated and
rooftop photovoltaics. The company manufactures, sells and installs
thin-film solar laminates that convert sunlight to energy using
proprietary technology. ECD's UNI-SOLAR brand products are unique
because of their flexibility, light weight, ease of installation,
durability, and real-world efficiency. Through its Solar Integrated
Technologies business, the company also designs, manufactures and
installs rooftop photovoltaic systems which enable customers to
transform unused space on the rooftop into a value-generating
asset. For more information, please visit
http://www.energyconversiondevices.com/. This release may contain
forward-looking statements within the meaning of the Safe Harbor
Provisions of the Private Securities Litigation Reform Act of 1995.
Forward-looking statements include statements concerning our plans,
objectives, goals, strategies, future events, future net sales or
performance, capital expenditures, financing needs, plans or
intentions relating to expansions, business trends and other
information that is not historical information. All forward-looking
statements are based upon information available to us on the date
of this release and are subject to risks, uncertainties and other
factors, many of which are outside of our control, that could cause
actual results to differ materially from the results discussed in
the forward-looking statements. Risks that could cause such results
to differ include: our ability to maintain our customer
relationships; the worldwide demand for electricity and the market
for solar energy; the supply and price of components and raw
materials for our products; and our customers' ability to access
the capital needed to finance the purchase of our products; and
risks associated with integrating Solar Integrated Technologies,
Inc. The risk factors identified in the ECD filings with the
Securities and Exchange Commission, including the company's most
recent Annual Report on Form 10-K and most recent Quarterly Report
on Form 10-Q, could impact any forward-looking statements contained
in this release. ENERGY CONVERSION DEVICES, INC. and SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS (In thousands, except per
share data) Quarter Ended June 30, Year Ended June 30, 2009 2008
2009 2008 ----- ---- ---- ---- REVENUES Product sales $46,014
$77,800 $294,992 $237,191 Royalties 1,991 1,262 6,355 5,306
Revenues from product development agreements 3,094 2,950 13,409
11,440 License and other revenues 316 376 1,537 1,924 --------
------ ------- ------- TOTAL REVENUES 51,415 82,388 316,293 255,861
EXPENSES Cost of product sales 41,001 51,966 208,285 174,075 Cost
of revenues from product development agreements 2,533 1,865 9,507
7,257 Product development and research 2,418 2,207 8,986 9,906
Preproduction costs 276 1,346 5,409 6,920 Selling, general and
administrative 14,915 13,957 58,902 51,252 Net loss on disposal of
property, plant and equipment 1,610 1,330 2,287 1,116 Restructuring
charges 1,657 1,940 2,231 9,396 -------- ------ ------- -------
TOTAL EXPENSES 64,410 74,611 295,607 259,922 -------- ------
------- ------- OPERATING INCOME (LOSS) (12,995) 7,777 20,686
(4,061) OTHER INCOME (EXPENSE) Interest income 443 981 5,226 7,019
Interest expense (3,003) (99) (10,863) (165) Other nonoperating
income (expense), net 437 1,274 (1,118) 1,216 -------- ------
------- ------- TOTAL OTHER INCOME (EXPENSE) (2,123) 2,156 (6,755)
8,070 -------- ------ ------- ------- Net Income (Loss) before
Income Taxes (15,118) 9,933 13,931 4,009 Income Taxes 653 61 1,475
156 -------- ------ ------- ------- Net Income (Loss) $(15,771)
$9,872 $12,456 $3,853 ======== ====== ======= ======= Earnings
(Loss) Per Share $(0.37) $0.24 $0.29 $0.10 ======== ====== =======
======= Diluted Earnings (Loss) Per Share $(0.37) $0.24 $0.29 $0.09
======== ====== ======= ====== Basic weighted average shares
outstanding 42,314 40,666 42,277 40,231 Diluted weighted average
shares outstanding 42,355 41,525 42,711 41,138 ENERGY CONVERSION
DEVICES, INC. and SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (in
thousands) June 30, 2009 2008 ---- ---- ASSETS Current Assets: Cash
and cash equivalents $56,379 $484,492 Short-term investments
245,182 14,989 Accounts receivable, net 69,382 53,525 Inventories,
net 74,266 31,337 Assets held for sale - 1,539 Other current assets
4,897 4,130 ---------- ---------- Total Current Assets 450,106
590,012 Property, Plant and Equipment, net 605,742 404,119
Long-Term Investments - 32,277 Other Assets 13,330 15,559
---------- ---------- Total Assets $1,069,178 $1,041,967 ==========
========== LIABILITIES AND STOCKHOLDERS' EQUITY Current
Liabilities: Accounts payable and accrued expenses $52,244 $39,017
Salaries, wages and amounts withheld from employees 3,243 3,160
Amounts due under incentive plans 694 6,747 Current maturities of
capital leases 1,013 1,087 Other 2,493 2,092 ---------- ----------
Total Current Liabilities 59,687 52,103 Long-Term Liabilities:
Convertible senior notes 316,250 316,250 Capital lease obligations
21,412 22,468 Other liabilities 9,701 9,234 ---------- ----------
Total Long-Term Liabilities 347,363 347,952 Commitments and
Contingencies Stockholders' Equity Common stock, $0.01 par value,
100 million shares authorized, 45,754,652 and 45,575,554 issued in
2009 and 2008, respectively 458 456 Additional paid-in capital
976,575 969,421 Treasury stock (700) (700) Accumulated deficit
(312,709) (325,165) Accumulated other comprehensive loss, net
(1,496) (2,100) ---------- ---------- Total Stockholders' Equity
662,128 641,912 ---------- ---------- Total Liabilities and
Stockholders' Equity $1,069,178 $1,041,967 ========== ==========
ENERGY CONVERSION DEVICES, INC. and SUBSIDIARIES CONSOLIDATED
STATEMENTS OF CASH FLOWS (in thousands) Year Ended June 30, 2009
2008 2007 ---- ---- ---- Cash flows from operating activities Net
income (loss) $12,456 $3,853 $(25,231) Adjustments to reconcile net
income (loss) to net cash provided by (used in) operating
activities: Depreciation and amortization 33,515 21,917 12,170
Provision for slow-moving and obsolete inventory 8,111 2,920 1,348
Allowance for doubtful accounts 3,692 868 10 Share-based
compensation 5,273 2,010 1,763 Warranty expense 5,680 391 (292)
Other-than-temporary impairment of investment 1,002 - - Loss (gain)
on sale of property, plant and equipment 2,287 1,116 504 Other
(597) 1,649 (700) Changes in operating assets and liabilities, net
of foreign exchange: Accounts receivable (21,068) (17,815) (8,590)
Inventories (51,165) 4,662 (17,165) Other assets 3,799 (1,168)
(2,371) Accounts payable and accrued expenses 14,661 4,004 12,914
Accrued incentive plan (6,053) 6,204 543 Restructuring reserve
(574) (2,301) 3,523 Other liabilities 70 200 (240) ------- --------
------- Net cash provided by (used in) operating activities 11,089
28,510 (21,814) Cash flows from investing activities: Purchases of
property, plant and equipment (242,257) (117,335) (186,989)
Investment in joint ventures (1,000) - (200) Purchases of
investments (203,355) (62,250) (423,033) Proceeds from maturities
of investments 3,400 22,591 248,180 Proceeds from sale of
investments 2,750 115,038 288,828 Proceeds from sale of property,
plant and equipment - 288 1 ------- -------- ------- Net cash used
in investing activities (440,462) (41,668) (73,213) Cash flows from
financing activities: Proceeds from convertible senior notes -
306,762 - Payments for deferred financing costs - (1,258) -
Proceeds from common stock issuance - 98,998 - Principal payments
under capitalized lease obligations (1,054) (1,144) (850) Increase
in long-term customer deposits - 680 - Decrease in restricted
investments - (273) - Proceeds from sale of stock and share-based
compensation, net of expenses 1,966 13,482 11,866 ------- --------
------- Net cash provided by financing activities 912 417,247
11,016 Effect of exchange rate changes on cash and cash equivalents
348 (367) (181) Net (decrease) increase in cash and cash
equivalents (428,113) 403,722 (84,192) Cash and cash equivalents at
beginning of period 484,492 80,770 164,962 ------- -------- -------
Cash and cash equivalents at end of period $56,379 $484,492 $80,770
======= ======== ======= DATASOURCE: Energy Conversion Devices,
Inc. CONTACT: Mark Trinske, Vice President, Investor Relations
& Communications of Energy Conversion Devices, Inc.,
+1-248-299-6063 Web Site: http://www.energyconversiondevices.com/
Copyright