Satcon® Reports First Quarter 2012 Financial Results

BOSTON–(BUSINESS WIRE)–May. 9, 2012–Satcon Technology Corporation® (NASDAQ CM:SATC), a leading provider of utility scale power conversion solutions for the renewable energy market, today announced its results for the first quarter endedMarch 31, 2012.

Revenue for the first quarter of 2012 was$24.3 million, compared with revenue of$36.0 millionin the fourth quarter of 2011, reflecting the anticipated seasonal slowdown in installations during the winter months. During the quarter, the company shipped 98 MWs of its industry-leading PowerGate® Plus, Prism® Platform, and Equinox® solutions.North Americacontinued to be the company’s strongest performing region in Q1, representing 96% of total revenue and megawatts shipped.

Gross margin for the quarter was 1%, compared with -64% in the fourth quarter of 2011. The company’s gross margin performance was impacted by seasonally lower sales volumes and the closing of its Canadian manufacturing facility, whereSatcontransferred its manufacturing to contract manufacturers inChinaandCanada.

Bookings for the first quarter were approximately$45.6 million, including$3.1 millionin service and extended warranty, an increase of approximately 134% from the fourth quarter of 2011 and 29% from the first quarter of 2011. In addition, the first quarter of 2012 was the company’s most successful bookings period in four quarters, with a book-to-bill ratio of 1.9:1.

“During the first quarter, we made significant progress on our strategic initiative and operating plan,” saidSteve Rhoades, Satcon’s President and Chief Executive Officer. “We improved our operational efficiency by reducing costs of our central inverter and MV platform product lines, and moved to a variable, contract manufacturing model with the closure of ourCanadafacility. We also strengthened our balance sheet and further reduced our working capital, while paying down a significant portion of our short- and long-term debt. These actions have strengthened our cash flow position and have provided sufficient liquidity to meet our obligations and pursue our long-term growth strategy.”

“We expect Q2 revenue to be between$24 million and $28 million, and gross margin to be in the mid- to high-teens,” concluded Rhoades.

Conference Call Reminder

The company will hold a conference call to review its financial results and business highlights today,May 9, 2012at5:00 p.m. ET. During the conference call, the company may answer questions concerning business and financial developments and trends, and other business and financial matters. The company’s responses to these questions, as well as other matters discussed during the conference call, may contain or constitute information that has not been previously disclosed.

The conference call will be webcast live over the Internet and can be accessed on the Investor Relations section of the company’s website at The conference call also can be accessed by dialing (877) 407-8289 (U.S. andCanada) or (201) 689-8341 (International). Interested parties that are unable to listen to the live call may access an archived version of the webcast on Satcon’s website.

About Satcon

Satcon Technology Corporationis a leading provider of utility-grade power conversion solutions for the renewable energy market, enabling the industry’s most advanced, reliable and proven clean energy alternatives. For more than ten years, Satconhas designed and delivered advanced power conversion products that enable large-scale producers of renewable energy to convert the clean energy they produce into grid-connected efficient and reliable power. To learn more about Satcon, please visit

Safe Harbor

Statements made in this document that are not historical facts or which apply prospectively are forward-looking statements that involve risks and uncertainties. These forward-looking statements are identified by the use of terms and phrases such as “will,” “intends,” “believes,” “expects,” “plans,” “anticipates” and similar expressions. Forward looking statements contained in this press release include, without limitation, the company’s expectations (i) that second-quarter 2012 revenue will be between$24 million and $28 million; (ii) that gross margin will be in the mid-to high-teens; and (iii) regarding its future prospects. Investors should not rely on forward looking statements because they are subject to a variety of risks and uncertainties and other factors that could cause actual results to differ materially from the company’s expectation. Additional information concerning risk factors is contained from time to time in the company’sSECfilings, including its Annual Report on Form 10-K and other periodic reports filed with theSEC. Forward-looking statements contained in this press release speak only as of the date of this release. Subsequent events or circumstances occurring after such date may render these statements incomplete or out of date. The company expressly disclaims any obligation to update the information contained in this release.



    March 31,
    December 31,
Current assets:          
Cash and cash equivalents   $ 15,916,614       $ 21,586,497  
Accounts receivable, net of allowances of $3,400,492 and $2,231,616 at March 31, 2012 and December 31, 2011, respectively     34,087,346         46,082,592  
Inventory     46,029,526         49,937,028  
Note receivable     100,000         4,114,388  
Prepaid expenses and other current assets     2,085,174         2,468,202  
Total current assets     98,218,660         124,188,707  
Property and equipment, net     10,565,644         11,091,910  
Other long-term assets     576,990         676,850  
Total assets   $ 109,361,294       $ 135,957,467  
Current liabilities:          
Line of credit   $ 20,487,546       $ 34,675,000  
Accounts payable     55,040,479         51,955,218  
Accrued payroll and payroll related expenses     2,142,444         3,011,981  
Other accrued expenses     7,473,788         6,959,197  
Accrued restructuring costs     896,285         1,543,830  
Note payable, current portion, net of discount of $273,796 and $320,592 at March 31, 2012 and December 31, 2011, respectively     4,093,930         3,912,600  
Current portion of subordinated convertible note     10,360,000         12,369,336  
Current portion of deferred revenue     3,460,394         6,015,235  
Total current liabilities     103,954,866         120,442,397  
Warrant liabilities     50,000         131,530  
Note payable, net of current portion and discount of $71,275 and $120,931 at March 31, 2012 and December 31, 2011, respectively     4,010,117         5,104,157  
Subordinated convertible note, net of current portion             5,870,664  
Deferred revenue, net of current portion     27,194,160         25,525,032  
Other long-term liabilities     715,076         709,986  
Total liabilities     135,924,219         157,783,766  
Commitments and contingencies          
Stockholders’ deficit:          
Preferred stock; $0.01 par value 1,000,000 shares authorized, 0 shares issued and outstanding at March 31, 2012 and December 31, 2011              
Common stock; $0.01 par value, 200,000,000 shares authorized; 135,125,036 and 121,803,656 shares issued and outstanding at March 31, 2012 and December 31, 2011, respectively     1,351,251         1,218,037  
Additional paid-in capital     314,109,889         305,310,085  
Accumulated deficit     (340,594,497 )       (326,924,853 )
Accumulated other comprehensive loss     (1,429,568 )       (1,429,568 )
Total stockholders’ deficit     (26,562,925 )       (21,826,299 )
Total liabilities and stockholders’ deficit   $ 109,361,294       $ 135,957,467  


    Three Months Ended
    March 31, 2012     March 31,2011
Product revenue   $ 24,288,514       $ 62,004,937  
Cost of product revenue     24,127,818         47,132,525  
Gross margin     160,696         14,872,412  
Operating expenses:          
Research and development     3,236,226         6,136,333  
Selling, general and administrative     9,975,174         10,223,313  
Restructuring charges     292,221          
Total operating expenses     13,503,621         16,359,646  
Operating loss     (13,342,925 )       (1,487,234 )
Change in fair value of convertible note and warrants     450,041         123,561  
Other income (expense), net     116,567         (199,856 )
Interest income     455         151  
Interest expense     (893,782 )       (575,249 )
Net loss before provision for income taxes     (13,669,644 )       (2,138,627 )
Provision for income taxes              
Net loss     (13,669,644 )       (2,138,627 )
Net loss per weighted average share, basic and diluted   $ (0.11 )     $ (0.02 )
Weighted average number of common shares, basic and diluted     128,096,372         118,726,322  

Source:Satcon Technology Corporation

Satcon Technology Corporation
Leah Gibson, 617-910-5515
Director of Investor Relations


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