Maxwell Technologies Reports Strong Third Quarter Sales Growth

Monday, November 03, 2008 4:01 PM
Symbols: MXWL
Ultracapacitor Sales and Total Revenue Both Up Over 50% vs. Q3 2007
CONFERENCE CALL & WEBCAST AT 5 P.M. (EST) TODAY - DETAILS BELOW
SAN DIEGO, Nov. 3 /PRNewswire-FirstCall/ -- Maxwell Technologies, Inc. (Nasdaq: MXWL) today reported revenue of $21.7 million for its third quarter ended September 30, 2008, an increase of 53 percent over the $14.2 million recorded in the same period in 2007. Operating loss for the third quarter 2008 was $3.6 million, compared with $3.5 million in the same period last year. Net loss for Q308 was $5.7 million, or $0.27 per share, compared with $2.6 million, or $0.13 per share, in Q307. The net loss comparison is affected by a non-cash charge of $1.0 million, or $0.05 per share, in Q308, versus a non-cash gain of $2.1 million, or $0.11 per share, in Q307, based on a quarterly 'mark-to-market' valuation of conversion features and warrants associated with convertible debentures issued in 2005.

Q308 BOOSTCAP(R) ultracapacitor revenue increased by 53 percent to $7.6 million, compared with $5.0 million for the same period last year. High voltage capacitor and microelectronics products also generated strong sales growth, combining for Q308 revenue of $14.1 million, up 53 percent from the $9.2 million recorded in Q307.

'New orders for ultracapacitor-based energy storage solutions for hybrid and electric transit buses, electric rail vehicles, fuel cell lift trucks and wind turbine pitch systems combined with existing customer volume to produce the second consecutive record quarter for ultracapacitor revenue,' said David Schramm, Maxwell's president and chief executive officer. 'Order activity continues to be robust, and we are on pace to record a significant increase in annual sales. However, while unit shipments continue to grow, a major portion of the company's revenue is denominated in Euros and Swiss Francs, so fourth quarter revenue is likely to be affected by fluctuations in the exchange rate between those currencies and the US dollar.'

Other significant recent developments include:
-- An order from Lti REEnergy GmbH, a leading producer of
electro-mechanical wind turbine blade pitch control systems, for
BOOSTCAP ultracapacitor modules to supply backup power for Lti's
PitchMaster(R) blade pitch control system.
-- An order from Plug Power, Inc., a leading developer of hydrogen fuel
cell-based power systems for electric lift trucks, for BOOSTCAP
ultracapacitor cells to enhance performance and energy management in
Plug's line of GenDrive(TM) power units.
Q308 gross margin was 30 percent, compared with 24 percent in Q307, and 28 percent in Q208. Operating expenses totaled approximately $10.1 million, or 46 percent of revenue in Q308, compared with $6.8 million, or 48 percent of revenue in Q307, and $9.6 million, or 49 percent of revenue in Q208. Cash and restricted cash totaled $21.6 million as of September 30, 2008, compared with $23.8 million as of June 30, 2008, including $3.6 million, net of fees, raised through the sale of 296,986 shares of the company's common stock at an average price of $12.68, under its Equity Distribution Program.

Complete financial statements and Management's Discussion and Analysis of Financial Condition and Results of Operations will be available with the filing of the company's Quarterly Report on Form 10-Q with the Securities & Exchange Commission.

Management will conduct a conference call and simultaneous webcast to discuss third quarter financial results and the outlook for the balance of 2008 at 5 p.m. (EST) today. The call may be accessed by dialing toll-free, (800) 862-9098 from the U.S. and Canada, or (785) 424-1051 for international callers. The live webcast may be accessed via the following link: http://www.maxwell.com/investors/investor-calendar.asp. Subsequent replay may be accessed at the company's Presentation Archive via the following link: http://www.maxwell.com/investors/presentations.asp

Maxwell is a leading developer and manufacturer of innovative, cost-effective energy storage and power delivery solutions. Our BOOSTCAP(R) ultracapacitor cells and multi-cell modules provide safe and reliable power solutions for applications in consumer and industrial electronics, transportation and telecommunications. Our CONDIS(R) high-voltage grading and coupling capacitors help to ensure the safety and reliability of electric utility infrastructure and other applications involving transport, distribution and measurement of high-voltage electrical energy. Our radiation-mitigated microelectronic products include power modules, memory modules and single board computers that incorporate powerful commercial silicon for superior performance and high reliability in aerospace applications.

Forward-Looking Statements -- Statements in this news release that are 'forward-looking statements' are based on current expectations and assumptions that are subject to risks and uncertainties. Actual results could differ materially because of factors such as:

-- the company's history of losses and uncertainty about its ability to
achieve or maintain profitability, or to obtain sufficient capital to
finance its operations;
-- recent disruption of global financial markets and reduced availability
of credit;
-- development and acceptance of products based on new technologies;
-- demand for original equipment manufacturers' products reaching
anticipated levels;
-- cost-effective manufacturing and the success of outsourced
manufacturing;
-- the impact of competitive products and pricing;
-- risks and uncertainties involved in foreign operations, including the
impact of currency fluctuations;
-- product liability or warranty claims in excess of reserves.
For further information regarding risks and uncertainties associated with Maxwell's business, please refer to the 'Management's Discussion and Analysis of Financial Condition and Results of Operations' and 'Risk Factors' sections of our SEC filings, including, but not limited to, our annual report on Form 10-K and quarterly reports on Form 10-Q, copies of which may be obtained by contacting Maxwell's investor relations department at (858) 503-3434 or at our investor relations website: http://www.maxwell.com/investors/sec-filing.asp. All information in this release is as of November 3, 2008. The company undertakes no duty to update any forward-looking statement to reflect actual results or changes in the company's expectations.

AND SUBSIDIARIES CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (Unaudited) Three Months Ended Nine Months Ended September 30, September 30, 2008 2007 2008 2007 Revenues: Sales $21,340 $13,727 $57,229 $39,088 License fee and service revenue 407 491 1,469 1,308 Total revenues 21,747 14,218 58,698 40,396 Cost of sales 15,239 10,872 41,427 30,945 Gross profit 6,508 3,346 17,271 9,451 Operating expenses: Selling, general and administrative 5,976 4,128 17,187 14,201 Research and development 4,003 2,637 10,796 8,548 Amortization of intangibles 94 64 270 148 Loss on sale of equipment - - - 52 Total operating expenses 10,073 6,829 28,253 22,949 Loss from operations (3,565) (3,483) (10,982) (13,498) Interest expense, net (132) (295) (399) (924) Amortization of debt discount and prepaid debt costs (553) (904) (1,922) (2,712) Gain (loss) on embedded derivatives and warrants (1,011) 2,120 (1,971) 2,193 Other income (expense), net (435) 217 (455) 422 Loss before income taxes (5,696) (2,345) (15,729) (14,519) Income tax provision 11 266 512 108 Net loss $(5,707) $(2,611) $(16,241) $(14,627) Basic and diluted net loss per common share $(0.27) $(0.13) $(0.79) $(0.82) Shares used in computing net loss per common share - basic and diluted 20,992 18,488 20,560 17,774 MAXWELL TECHNOLOGIES, INC. AND SUBSIDIARIES CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (Unaudited) September 30, December 31, 2008 2007 ASSETS Current assets: Cash and cash equivalents $12,793 $14,579 Investments in marketable securities - 7,635 Trade and other accounts receivable, net 13,439 13,933 Inventories, net 18,983 14,717 Prepaid expenses and other current assets 2,520 1,657 Total current assets 47,735 52,521 Property and equipment, net 16,488 14,636 Intangible assets, net 3,876 3,154 Goodwill 21,678 21,183 Prepaid pension asset 9,169 8,369 Restricted cash 8,825 8,000 Other non-current assets 176 417 Total assets $107,947 $108,280 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $13,193 $9,516 Accrued warranty 823 768 Accrued employee compensation 3,731 2,885 Short-term borrowings and current portion of long-term debt 16,721 16,472 Deferred tax liability 378 378 Total current liabilities 34,846 30,019 Deferred tax liability, long-term 1,493 1,493 Convertible debenture and long-term debt, excluding current portion 7,226 13,544 Stock warrants 1,687 577 Other long-term liabilities 746 535 Total long-term liabilities 45,998 46,168 Commitments and contingencies Stockholders' equity: Common stock, $0.10 par value per share, 40,000 shares authorized; 21,814 and 20,417 shares issued and outstanding at September 30, 2008 and December 31, 2007, respectively 2,181 2,042 Additional paid-in capital 188,066 172,899 Accumulated deficit (136,335) (120,094) Accumulated other comprehensive income 8,037 7,265 Total stockholders' equity 61,949 62,112 Total liabilities and stockholders' equity $107,947 $108,280
SOURCE Maxwell Technologies, Inc.

(Source: PR Newswire )

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