Capstone Turbine Corporation Announces Fiscal 2007 Operating Results
Fiscal 2007 revenue of $21.0 million, net loss decreases over $10.3 million from prior year; Fourth quarter revenue of $5.8 million, net loss decreases over $3.3 million from same period last year.
CHATSWORTH, Calif.--
Capstone Turbine Corporation(R) (www.microturbine.com) (NASDAQ:CPST), reported operating results for its fourth quarter and fiscal year ended March 31, 2007 in its Annual Report on Form 10-K filed with the Securities and Exchange Commission on June 13, 2007.
Financial Summary
Capstone's revenue for the fiscal year ended March 31, 2007 was $21.0 million, a decrease of approximately 13% from the prior fiscal year. While sales are not increasing as we expected, we continue to pursue market penetration through the use of worldwide distributors and our direct sales resources.
The reported gross loss for the fiscal year ended March 31, 2007 was $5.0 million, or 24% of revenue, an improvement of approximately 19 points over the prior fiscal year.
The year over year improvement in the gross loss percentage reflects the increased contribution margins from improved product mix as a result of increased sales of higher margin C60 Series units, reduced manufacturing costs, higher absorption of overhead costs into ending inventory and reduced inventory charges offset by increased warranty charges.
Research and development costs were $9.4 million for the fiscal year ended March 31, 2007, a decrease of $1.6 million, or 15% from the prior fiscal year. Expenses were lower primarily due to lower labor and consulting spending, decreased development hardware and supplies, and reduced facilities expenses offset by decreased funding received from cost sharing programs.
Selling, general and administrative costs were $24.6 million for the fiscal year ended March 31, 2007, a decrease of $3.1 million, or 11% from the prior fiscal year. Included in SG&A expenses for the year ended March 31, 2007 was $2.3 million of non-cash stock compensation, compared to $1.0 million for the same period last year. This increase is a result of the Company's adoption of SFAS 123(R) during the first quarter of Fiscal 2007. Other SG&A expenses decreased $4.5 million compared to the prior year. The decrease was primarily attributable to legal settlement costs incurred in the prior year, reduced professional services including legal, accounting and insurance, lower labor and related costs, consulting fees and marketing costs, offset by increased bad debt and facilities costs.
Capstone's net loss was $36.7 million, or $0.32 per share, for the fiscal year ended March 31, 2007, a decrease of $10.3 million from the $47.1 million loss, or $0.50 per share, reported for the prior fiscal year.
Cash and cash equivalents at the end of the fiscal year ended March 31, 2007 were $60.3 million. Cash balances increased by $2.3 million during the fiscal year ended March 31, 2007. The Company completed a registered offering of its common stock during the fourth quarter, resulting in net proceeds of approximately $42.5 million.
Backlog at the end of the fiscal year was $5.0 million, a decrease of over 29% from the prior fiscal year end, and approximately 38% from the prior quarter.
Revenue for the fourth quarter ended March 31, 2007 increased to $5.8 million, an improvement of 1% from the third quarter, and decreased approximately 23% from the prior year comparable quarter.
The reported gross loss for the 2007 fourth quarter was $1.0 million, or 17% of revenue compared to $3.2 million, or 43% for the 2006 fourth quarter, an improvement of approximately 26 points.
The quarter over quarter improvement in the gross loss percentage reflects the increased contribution margins from improved product mix as a result of increased sales of higher margin C60 Series units, reduced manufacturing costs, higher absorption of overhead costs into ending inventory and reduced inventory charges offset by increased warranty charges.
Research and development costs were $2.0 million for the fourth quarter, a decrease of $1.1 million, or 37%, from the prior year comparable quarter. Expenses were lower primarily due to lower labor and consulting spending, decreased development hardware and supplies, and reduced facilities expenses offset by decreased funding received from cost sharing programs.
Selling, general and administrative costs were $6.3 million for the fourth quarter, an increase of $0.1 million, or 2% from the prior year comparable quarter. Included in SG&A expenses for the fourth quarter was $0.6 million of non-cash stock compensation, compared to $0.2 million for the same period last year. This increase is a result of the Company's adoption of SFAS 123(R) during the first quarter of Fiscal 2007. Other SG&A expenses decreased $0.3 million compared to the same period last year. The decrease was primarily attributable to reduced labor and related costs and marketing costs, offset by increased bad debt and facilities costs.
Capstone's net loss was $8.5 million for the fourth quarter, or $0.06 per share, an improvement of $3.3 million from the $11.8 million loss, or $0.12 per share, reported for the prior year comparable quarter.
Conference Call
The Company will host a conference call today, Wednesday, June 13, at 1:45 p.m. Pacific Time. Access to the live broadcast and a replay of the webcast will be available for 90 days through the Investor Relations page on the Company's website: www.microturbine.com.
About Capstone Turbine
Capstone Turbine Corporation (www.microturbine.com; NASDAQ:CPST) is the world's leading producer of low-emission microturbine systems, and was the first to market commercially viable microturbine energy products. Capstone Turbine has shipped thousands of Capstone MicroTurbine(TM) systems to customers worldwide. Capstone Turbine is a member of the U.S. Environmental Protection Agency's Combined Heat and Power Partnership, which is committed to improving the efficiency of the nation's energy infrastructure and reducing emissions of pollutants and greenhouse gases. A UL-Certified ISO 9001:2000 certified company; Capstone Turbine is headquartered in the Los Angeles area with sales and/or service centers in New York, Mexico City, Milan, Nottingham, Shanghai and Tokyo.
"Capstone Turbine Corporation" and "Capstone MicroTurbine" are registered trademarks of Capstone Turbine Corporation. All other trademarks mentioned are the property of their respective owners.
CAPSTONE TURBINE CORPORATION AND SUBSIDIARY
CONSOLIDATED BALANCE SHEETS
(In thousands, except share amounts)
March 31, March 31,
2007 2006
--------- ---------
Assets
Current Assets:
Cash and cash equivalents $60,322 $58,051
Accounts receivable, net of allowance for
doubtful accounts and sales returns of $789 in
2007 and $858 in 2006 3,514 5,869
Inventories 21,283 12,545
Prepaid expenses and other current assets 1,614 1,050
--------- ---------
Total current assets 86,733 77,515
--------- ---------
Property, plant and equipment, net 6,256 7,816
Non-current portion of inventories 3,005 3,113
Intangible asset, net 892 1,159
Other assets 117 114
--------- ---------
Total $97,003 $89,717
========= =========
Liabilities and Stockholders' Equity
Current Liabilities:
Accounts payable and accrued expenses $5,686 $8,144
Accrued salaries and wages 1,434 1,623
Accrued warranty reserve 6,554 6,998
Deferred revenue 937 632
Current portion of notes payable 19 19
--------- ---------
Total current liabilities 14,630 17,416
--------- ---------
Long-term portion of notes payable 27 47
Other long-term liabilities 561 626
Stockholders' Equity:
Preferred stock, $.001 par value; 10,000,000
shares authorized; none issued -- --
Common stock, $.001 par value; 415,000,000
shares authorized; 144,512,997 shares issued
and 143,961,789 shares outstanding at March
31, 2007; 103,521,829 shares issued and
102,970,621 shares outstanding at March 31,
2006 145 104
Additional paid-in capital 619,423 572,787
Accumulated deficit (537,270) (500,542)
Deferred stock compensation -- (208)
Treasury stock, at cost; 551,208 shares at March
31, 2007 and 2006 (513) (513)
--------- ---------
Total stockholders' equity 81,785 71,628
--------- ---------
Total $97,003 $89,717
========= =========
CAPSTONE TURBINE CORPORATION AND SUBSIDIARY
CONSOLIDATED STATEMENTS OF OPERATIONS
(In thousands, except per share amounts)
Years Ended March 31,
-----------------------------
2007 2006 2005
--------- --------- ---------
Net revenue $21,018 $24,103 $16,968
Cost of goods sold (includes stock-
based compensation of $107, $0 and $0,
for the periods presented,
respectively) 26,045 34,563 25,545
--------- --------- ---------
Gross loss (5,027) (10,460) (8,577)
Operating expenses:
Research and development (includes
stock-based compensation of $232, $0
and $4, for the periods presented,
respectively) 9,374 11,019 11,761
Selling, general and administrative
(includes stock-based compensation
of $2,369, $953 and $376, for the
periods presented, respectively) 24,615 27,741 20,782
--------- --------- ---------
Total operating costs and expenses 33,989 38,760 32,543
--------- --------- ---------
Loss from operations (39,016) (49,220) (41,120)
Interest income 2,292 2,143 1,338
Interest expense (2) (23) (37)
Other income, net -- 29 372
--------- --------- ---------
Loss before income taxes (36,726) (47,071) (39,447)
Provision for income taxes 2 2 2
--------- --------- ---------
Net loss $(36,728) $(47,073) $(39,449)
========= ========= =========
Net loss per common share--basic and
diluted $(0.32) $(0.50) $(0.47)
========= ========= =========
Weighted average share used to
calculate basic and diluted net loss
per common share 113,770 93,638 84,378
========= ========= =========
Source: Capstone Turbine Corporation
Released June 13, 2007
