LATHAM, N.Y., Aug. 6, 2008 (PRIME NEWSWIRE) -- Plug Power Inc. (Nasdaq:PLUG), a leader in providing clean, reliable energy solutions, today provided a progress update and reported its financial results for the second quarter of 2008.
Revenue for the second quarter of 2008 was $4.8 million. This compares with revenue in the same period in 2007 of $4.0 million.
Net loss for the second quarter of 2008 was $22.9 million, or $0.26 per share on a basic and diluted basis, compared with $16.7 million, or $0.19 per share, for the second quarter of 2007.
Included in the net loss for the quarter was $3.6 million in charges associated with implementation of the Company's restructuring plan announced on June 11, 2008, and $1.7 million for an additional impairment charge to the Company's available-for-sale securities portfolio.
"There's been a lot of change at Plug Power over the first half of 2008. We have focused our efforts on planning and restructuring to create a customer- and market-focused organization which emphasizes sales and marketing," said Andy Marsh, president and CEO of Plug Power. "Based on our reorganization, the continued dedication of our employees and the market readiness of our commercial products, we expect to show strong results in the second half of 2008."
During the quarter, Plug Power shipped units to Wal-Mart, which began the next phase of its ongoing trials with Plug Power's GenDrive motive power solution at a distribution center in Ohio. Plug Power also extended its supply agreement with Ballard Power Systems through 2010.
Plug Power is in the process of negotiating agreements with several major utility partners in Europe and North America to begin product testing on its high-temperature GenSys(r) combined heat and power system. Designed as a drop-in replacement for existing furnaces and boilers, the high-temperature GenSys fuel cell system is expected to create value for consumers through lower utility bills and a smaller carbon footprint. The Company also received $500,000 in funding through the New York State Energy Research and Development Authority (NYSERDA) to focus on accelerated engineering and product refinement through the integration of a peak burner into the system, which enables rapid start-up time and lower integration costs into residential and small commercial applications.
"GenDrive is our primary focus for near-term commercialization, but we will invest significant resources in GenSys as well," commented Marsh. "This strategy balances the importance of near-term commercial success with an eye toward entering larger markets in the future."
The Company has established the following milestones for the remainder of 2008:
* Secure 150 to 200 GenDrive orders
* Secure 50 GenCore(r) orders
* Contain net cash used in operating expenses to $55-$60 million for the full year
Product Installations, Shipments and Backlog
Total shipments in the second quarter were 92 units, comprised of 53 GenCore and 39 GenDrive systems.
During the second quarter of 2008, Plug Power received a total of 40 new unit orders. Total product backlog at June 30, 2008, was 244 units. Product orders include firm orders, stocking orders and orders that require certain conditions or contingencies and certain redesign elements to be satisfied prior to shipment, some of which are outside Plug Power's control. The time periods from order receipt to shipment date and from shipment date to installation vary widely and are determined by a number of factors, including the customer contract terms and deployment plan as well as siting, permitting and construction.
Revenue
Product and service revenue was $1.1 million for the second quarter of 2008, while research and development (R&D) contract work contributed $3.7 million to the quarter's revenue total. These amounts compare with $0.7 million for product and service revenue and $3.3 million for R&D contract revenue for the second quarter of 2007. Plug Power defers recognition of product and service revenue and recognizes revenue on a straight-line basis over the service period of each sold system. Deferred revenue was $4.4 million at June 30, 2008. Plug Power expects to recognize substantially all of this deferred product and services revenue over future periods.
Operational Results
Total cost of revenue for the second quarter was $8.6 million, comprised of $2.8 million for product and service cost of revenue and $5.8 million for R&D contract cost of revenue. This compares to total cost of revenue of $9.1 million in the second quarter of 2007, which was comprised of $4.4 million for cost of product and service revenue and $4.7 million for cost of R&D contract revenue.
R&D expenses for the second quarter of 2008 were $8.9 million compared with $8.8 million for the second quarter of 2007.
Selling, general and administrative (SG&A) expenses were $8.4 million (inclusive of the $3.6 million in restructuring charges) for the second quarter of 2008 compared with $5.0 million for the second quarter of 2007.
Cash and Liquidity
Net cash used in operating activities for the quarter ended June 30, 2008, was $16.4 million and an additional $0.5 million was used for capital expenditures. On June 30, 2008, Plug Power had cash, cash equivalents and available-for-sale securities of $127.9 million and net working capital of $124.7 million, compared with $190.8 million and $192.9 million, respectively, at June 30, 2007.
Conference Call
Plug Power has scheduled a conference call today at 10:00 a.m. (EDT) to review the Company's results for the second quarter of 2008. Interested parties are invited to listen to the conference call by calling (877) 407-8291 or (201) 689-8345 for international participants.
The webcast can be accessed by visiting the Plug Power Web site at www.plugpower.com and selecting the conference call link on the home page. The call will be archived on the Company's Web site for a period of time following the call.
About Plug Power
Plug Power Inc. (Nasdaq:PLUG), an established leader in the development and deployment of clean, reliable energy solutions, integrates fuel cell technology into backup, motive and continuous power products for telecommunications, material handling, utility and uninterruptible power supply applications. The Company is actively engaged with private and public customers in targeted markets throughout the world, including North America, Europe, the Middle East, Russia, South Africa and South America. For more information about how to join Plug Power's energy revolution as an investor, customer, supplier or strategic partner, please visit www.plugpower.com.
The Plug Power Inc. logo is available at http://www.primenewswire.com/newsroom/prs/?pkgid=4446
Safe Harbor Statement
This communication contains forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, including but not limited to statements regarding our growth plans. We believe that it is important to communicate our future expectations to our investors. However, there may be events in the future that we are not able to accurately predict or control and that may cause our actual results to differ materially from the expectations we describe in our forward-looking statements, including, without limitation, the risk that the restructuring results in greater restructuring charges or less cost savings; the risk that the FCC does not adopt rules regarding backup power requirements; the risk that unit orders will not ship, be installed and/or convert to revenue, in whole or in part; Plug Power's ability to develop commercially viable energy products; the cost and timing of developing Plug Power's energy products; market acceptance of Plug Power's energy products; Plug Power's ability to manufacture energy products on a large-scale commercial basis; competitive factors, such as price competition and competition from other traditional and alternative energy companies; the cost and availability of components and parts for Plug Power's energy products; the cost and availability of fuel and fueling infrastructures for Plug Power's energy products; Plug Power's ability to establish relationships with third parties with respect to product development, manufacturing, distribution and servicing and the supply of key product components; Plug Power's ability to protect its Intellectual Property; Plug Power's ability to lower the cost of its energy products and demonstrate their reliability; the cost of complying with current and future governmental regulations; the impact of deregulation and restructuring of the electric utility industry on demand for Plug Power's energy products; and other risks and uncertainties discussed under "Item IA-Risk Factors" in Plug Power's annual report on Form 10-K for the fiscal year ended December 31, 2007, filed with the Securities and Exchange Commission ("SEC") on March 17, 2008, and the reports Plug Power files from time to time with the SEC. Plug Power does not intend to and undertakes no duty to update the information contained in this communication.
Plug Power Inc.
Financial Highlights
Balance Sheets (Dollars in thousands):
--------------------------------------
(unaudited)
June 30, December 31,
2008 2007
-------- --------
Assets
Current assets:
Cash and cash equivalents $ 24,643 $ 12,077
Available-for-sale securities 103,239 153,624
Accounts receivable 5,690 4,338
Inventory 5,172 5,787
Government assistance receivable 205 270
Prepaid expenses and other current assets 1,237 2,721
-------- --------
Total current assets 140,186 178,817
Property, plant and equipment, net 20,208 21,065
Goodwill and intangible assets, net 65,723 68,379
Other assets 162 131
-------- --------
Total assets $226,279 $268,392
======== ========
Liabilities and Stockholders' Equity
Current liabilities:
Accounts payable $ 2,960 $ 4,637
Accrued expenses 6,061 5,510
Deferred revenue 4,443 3,341
Other current liabilities 2,038 1,423
-------- --------
Total current liabilities 15,502 14,911
Other liabilities 4,516 4,580
-------- --------
Total liabilities 20,018 19,491
Stockholders' equity 206,261 248,901
-------- --------
Total liabilities and
stockholders' equity $226,279 $268,392
======== ========
Statements of Operations (Dollars in thousands):
------------------------------------------------
(unaudited)
Three months ended Six months ended
June 30, June 30,
---------------------- ----------------------
2008 2007 2008 2007
---------- ---------- ---------- ----------
Revenue
Product and
service revenue $ 1,130 $ 676 $ 1,981 $ 1,138
Research and
development contract
revenue 3,702 3,331 6,589 5,499
---------- ---------- ---------- ----------
Total revenue 4,832 4,007 8,570 6,637
Cost of revenue and
expenses
Cost of product and
service revenue 2,827 4,382 4,465 6,066
Cost of research and
development contract
revenue 5,758 4,723 10,732 7,376
Research and development
expense 8,858 8,787 18,895 18,085
Selling, general and
administrative expense 8,421 4,985 14,882 9,036
Amortization of
intangible assets 573 456 1,148 456
---------- ---------- ---------- ----------
Operating loss (21,605) (19,326) (41,552) (34,382)
Interest income and
net realized gains
(losses) from the
sale of available-
for-sale securities 657 2,644 2,778 6,517
Impairment loss on
available-for-sale
security (1,698) -- (4,493) --
Interest and other
expense (221) (45) (327) (45)
---------- ---------- ---------- ----------
Net loss $ (22,867) $ (16,727) $ (43,594) $ (27,910)
========== ========== ========== ==========
Loss per share:
Basic and diluted $ (0.26) $ (0.19) $ (0.49) $ (0.32)
========== ========== ========== ==========
Weighted average
number of common
shares outstanding 88,147,533 86,656,349 88,109,365 86,552,825
========== ========== ========== ==========