News Column

Active Power Posts 4th Quarter and Year End 2013 Results

February 21, 2014

Active Power reported results for the fourth quarter and full year ended December 31, 2013.

Q4 2013 and Full Year Financial Highlights

-Full year 2013 revenue was $61.7 million compared to $76.3 million in 2012.

-Fourth quarter 2013 revenue increased $772,000 from the previous quarter to $13.9 million.

-Annual service revenue increased $3.3 million or 23 percent to $17.5 million compared to 2012, marking the 10th consecutive year service revenue has increased.

Operational Highlights

-Booked and shipped a large UPS order to IT partner IO, a global leader in software-defined data centers, for deployment at a university's high performance computing center on the east coast.

-Appointed Jay Powers as CFO and vice president of Finance, bringing to the company more than 30 years of broad and deep experience at both domestic and international organizations in a variety of industries including manufacturing, power quality, and energy storage.

-Appointed Randall J. Adleman as vice president of Global Sales and Marketing, bringing to Active Power more than two decades of sales and marketing leadership in the power quality, energy storage, and enterprise software sectors.

In a release on February 18, the Company noted that revenue in the fourth quarter of 2013 increased to $13.9 million from $13.2 million in the previous quarter and declined from $15.2 million in the fourth quarter of 2012. The increase and decline was primarily attributed to variations in MIS revenue. For the full year, total revenue was $61.7 million compared to $76.3 million in 2012. The decline was due to a 36 percent decrease in UPS sales and a 19 percent decrease in MIS sales, partially offset by a 23 percent increase in service revenue. The decrease in UPS sales was due to a large deal that represented more than 10 percent of total revenue in 2012 which was not repeated in 2013.

Gross margin in the fourth quarter of 2013 was 30.0 percent, flat from the previous quarter and compared to 39.5 percent in the fourth quarter of 2012. The decrease in gross margin compared to the fourth quarter of 2012 was primarily due to strong margins on ancillary products in the 2012 period and higher unabsorbed production costs in 2013. For the full year, gross margin was 31.4 percent compared to 32.4 percent in 2012.

Operating expenses were $8.0 million in the fourth quarter of 2013, compared to $6.9 million in the previous quarter and $6.3 million in the fourth quarter of 2012. The sequential increase was due to unexpected expenses including severance, CEO transition costs, stock-based compensation, relocation, and legal fees, partially offset by a reduction of bad debt expense and lower product development expenses. The increase from the year-ago quarter was due to many of the same items noted above.

For the full year, operating expenses increased to $27.0 million from $26.4 million in 2012. This increase was driven by higher product development expenses from investment in the Company's next generation UPS product line, severance, relocation related to executive transitions, stock-based compensation, and legal fees, partially offset by lower recruiting and contract labor expenses and depreciation.

Net loss in the fourth quarter of 2013 was $4.1 million or $(0.21) per share, compared to a net loss of $3.1 million or $(0.16) per share in the previous quarter and net loss of $0.4 million or $(0.02) per share in the fourth quarter of 2012. The increase in net loss from the previous quarter and the fourth quarter of 2012 was primarily due to the items noted above. For the full year, net loss was $8.4 million or $(0.44) per share compared to a loss of $1.9 million or $(0.10) per share in 2012.

"While it was a challenging year due to setbacks in China and executive transitions, we believe we exited the year in a strong position to grow the business," said Mark A. Ascolese, president and CEO of Active Power. "We have a new leadership team in place, a streamlined organization to strengthen sales productivity, a new focus on bookings, and our first CleanSource HD products were shipped in the fourth quarter of 2013."

"Our core foundational technology is the flywheel and its associated power electronics which we believe is still our most distinct competitive advantage and the basis of our current product offerings. Going forward, we view this technology as an enabler in our sales, marketing, and product development efforts and will use it as a template to ensure we do not stray from what we do best. Our priorities align with this strategy and are aimed at driving more consistent and predictable sales performance, leveraging the products and solutions we have available now to grow the business, and positioning the organization as an mission critical energy storage company."

Active Power is a company focusing on designing and manufacturing uninterruptible power supply (UPS) systems and modular infrastructure solutions that enable data centers and other mission critical operations to remain 'on' 24 hours a day, seven days a week.

More information:

www.activepower.com

((Comments on this story may be sent to newsdesk@closeupmedia.com))


For more stories on investments and markets, please see HispanicBusiness' Finance Channel



Source: Professional Services Close - Up


Story Tools