Plug Power Announces Fourth Quarter and Year-End 2012 Financial Results LATHAM, N.Y., March 28, 2013 (GLOBE NEWSWIRE) -- Plug Power Inc. (Nasdaq:PLUG), a leader in providing clean, reliable energy solutions, today reported its financial results for the fourth quarter and year-end 2012. Plug Power is pleased to announce that for the full year 2012, expansion of our customer base in North America continued with new, first-time orders from Stihl, Mercedes Benz, Lowe's, Carter's and Ace Hardware. The Company also received additional orders for existing customers including Walmart, P&G, Coca-Cola, Sysco Foods, Wegmans, Kroger and BMW. Product shipments also increased reaching 1,391 units, a 35% growth from the previous year shipments. Another 2012 success for Plug Power was completing the introduction of the new product platforms in the third quarter. The new platforms reduced material cost, a key driver for product margins, by an average of 30%. As announced in the third quarter, the Company experienced a number of quality issues in 2012, which negatively impacted its financial performance. The quality issues have been technically addressed, and a majority of the changes have been implemented as of the end of the fourth quarter. As previously discussed, we believe the quality issues have caused our sales to be delayed by six to nine months, though the Company has been successful in maintaining customer loyalty.Increased costs and delayed sales forced the Company to adopt a restructuring plan in the fourth quarter to improve organizational efficiency and conserve working capital needed to support the growth of its GenDrive business. Additionally, to continue to support our stakeholders, by the direction of the board of directors, the Company continues to consider all strategic options to provide funding for the business plan.The options include raising additional capital, asset sales, strategic partnerships and a sale of the Company.In 2012, the Company engaged Stephens, its long-time investment banking firm, to assist with exploring and implementing these options. "The main goal of the Company is to continue to build a successful market in material handling and expand into related applications such as refrigerated trucks, ground support equipment and range extending utility vehicles," said Andy Marsh, CEO at Plug Power."While the Company has experienced significant challenges in 2012, I believe the future of Plug Power is bright and that we are in the right market, with the right customers.We remain focused on the future." Financial Results Net loss for the fourth quarter of 2012 and year ended December 31, 2012 was $8.5 million and $31.9 million, respectively.On a per share basis (basic and diluted), the loss for the quarter and the year was $0.22 and $0.93, respectively.This compares with a net loss of $7.2 million, or $0.32 per share (basic and diluted), for the fourth quarter of 2011 and net loss of $27.5 million, or $1.46 per share (basic and diluted) for the full year 2011. Total revenue for the fourth quarter and year ended December 31, 2012 was $5.9 million and $26.1 million, respectively. This compares to total revenue of $11.9 million and $27.6 million for the same periods of 2011.Product and service revenue for the fourth quarter and year ended December 31, 2012 was $5.7 million and $24.4 million, respectively.This compares to $11.3 million and $23.2 million for the same periods of 2011. Research and development contract revenue for the quarter and year ended December 31, 2012 was $0.2 million and $1.7 million, respectively.This compares to $0.5 million and $3.9 million for the same periods of 2011. Total cost of revenue for the fourth quarter of 2012 was $9.5 million, comprised of $9.1 million for cost of product and service revenue and $0.4 million for cost of research and development contract revenue. For the full year 2012, total cost of revenue was $40.5 million, comprised of $37.7 million for cost of product and service revenue and $2.8 million for cost of research and development contract revenue.Prior year comparable numbers for the fourth quarter were $12.2 million for total cost of revenue, comprised of $11.5 million for cost of product and service revenue and $0.7 million for cost of research and development contract revenue.Prior full year comparable numbers were $36.9 million for total cost of revenue, comprised of $30.7 million for cost of product and service revenue and $6.2 million for cost of research and development contract revenue. Research and development expenses for the fourth quarter and year ended December 31, 2012 were $1.3 million and $5.4 million, respectively.This compares to the fourth quarter and year ended December 31, 2011 of $2.0 million and $5.7 million, respectively. Selling, general and administrative (SG&A) expenses for the fourth quarter and year ended December 31, 2012 were $4.0 million and $14.6 million, respectively.This compares to SG&A expenses in the fourth quarter and year ended December 31, 2011 of $3.5 million and $14.5 million, respectively.Additionally, $0.6 million was expensed for amortization of intangible assets during the fourth quarter of 2012 and the fourth quarter of 2011. For the full year, $2.3 million was expensed for amortization of intangible assets for 2012 and 2011. Cash and Liquidity Net cash used in operating activities for the fourth quarter and year ended December 31, 2012 was $4.6 million and $20.2 million, respectively. On December 31, 2012, Plug Power had cash and cash equivalents of $9.4 million and net working capital of $6.9 million.This compares to $13.9 million and $22.5 million, respectively, at December 31, 2011. The accompanying financial information and reconciliation tables provide additional information on the Company's year-to-date performance as it relates to the full year 2012 milestones previously announced. Conference Call Plug Power has scheduled a conference call today at 10:00 am ET to review the Company's results for the 2012 fourth quarter and year-end results. Interested parties are invited to listen to the conference call by calling 877.407.8291. The webcast can be accessed by going directly to the Plug Power Web site (www.plugpower.com) and selecting the conference call link on the home page.A playback of the call will be available online for a period following the call. About Plug Power Inc. The architects of modern fuel cell technology, Plug Power revolutionized the industry with cost-effective power solutions that increase productivity, lower operating costs and reduce carbon footprints. Long-standing relationships with industry leaders forged the path for Plug Power's key accounts, including Walmart, Sysco and Coca-Cola. With more than 3,000 GenDrive units shipped to material handling customers, accumulating over 8 million hours of runtime, Plug Power manufactures tomorrow's incumbent power solutions today. Additional information about Plug Power is available at www.plugpower.com. Plug Power Inc. 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 Plug Power's expected use of the net proceeds from the offering. These statements are based on current expectations that are subject to certain assumptions, risks and uncertainties, any of which are difficult to predict, are beyond Plug Power's control and that may cause Plug Power's actual results to differ materially from the expectations in Plug Power's forward-looking statements including statements regarding the risk that we may not have sufficient cash to fund our operations to profitability and that we may be required to seek strategic alternatives, including but not limited to a potential business combination or a sale of the company, or reduce and/or cease our operations, other risks and uncertainties related to satisfaction of the closing conditions of the offering, the estimated proceeds from the offering and the anticipated use of proceeds from the offering, the risk that unit orders will not ship, be installed and/or convert to revenue, in whole or in part; the cost and timing of developing Plug Power's products and its ability to raise the necessary capital to fund such development costs; the ability to achieve the forecasted gross margin on the sale of Plug Power's products; the actual net cash used for operating expenses may exceed the projected net cash for operating expenses; the cost and availability of fuel and fueling infrastructures for Plug Power's products; market acceptance of Plug Power's GenDrive system; Plug Power's ability to establish and maintain relationships with third parties with respect to product development, manufacturing, distribution and servicing and the supply of key product components; the cost and availability of components and parts for Plug Power's products; Plug Power's ability to develop commercially viable products; Plug Power's ability to reduce product and manufacturing costs; Plug Power's ability to successfully expand its product lines; Plug Power's ability to improve system reliability for GenDrive; competitive factors, such as price competition and competition from other traditional and alternative energy companies; Plug Power's ability to manufacture products on a large-scale commercial basis; Plug Power's ability to protect its intellectual property; the cost of complying with current and future governmental regulations; and other risks and uncertainties discussed in the reports Plug Power files from time to time with the SEC. Plug Power does not intend to, and undertakes no duty to update any forward-looking statements as a result of new information or future events. Plug Power Inc. Financial Highlights Balance Sheets (Dollars in thousands): (unaudited) December 31, December 31, 2012 2011 Assets Current assets: Cash and cash equivalents $9,380 $13,857 Accounts receivable 4,022 13,389 Inventory 8,550 10,355 Prepaid expenses and other 1,988 1,894 current assets Total current assets 23,940 39,495 Property, plant and 6,708 8,687 equipment, net Leased property under 2,970 -- capital lease, net Note receivable 571 -- Intangible assets, net 5,271 7,474 Total assets $39,460 $55,656 Liabilities and Stockholders' Equity Current liabilities: Borrowings under line of $3,381 $5,405 credit Accounts payable 3,558 4,669 Accrued expenses 3,828 3,173 Product warranty reserve 2,672 1,211 Deferred revenue 2,950 2,505 Obligations under capital 650 -- lease Other current liabilities -- 80 Total current liabilities 17,039 17,043 Obligations under capital 1,305 -- leases Deferred revenue 4,362 3,037 Common stock warrant 476 5,321 liability Other liabilities 1,248 1,219 Total liabilities 24,430 26,620 Stockholders' equity 15,030 29,036 Total liabilities and $39,460 $55,656 stockholders' equity Statements of Operations Three months ended Twelve months ended (Dollars in thousands): December 31, December 31, (unaudited) 2012 2011 2012 2011 Revenue Product and service revenue $5,696 $11,296 $24,407 $23,223 Research and development 226 544 1,701 3,886 contract revenue Licensed technology revenue -- 27 -- 517 Total revenue 5,922 11,867 26,108 27,626 Cost of revenue and expenses Cost of product and service 9,106 11,482 37,657 30,670 revenue Cost of research and 415 726 2,805 6,232 development contract revenue Research and development 1,345 2,008 5,434 5,656 expense Selling, general and 4,020 3,495 14,577 14,546 administrative expense Gain on sale of leased -- -- -- (673) assets Amortization of intangible 580 568 2,306 2,322 assets Operating loss (9,544) (6,412) (36,671) (31,127) Interest and other income and net realized losses from 55 27 226 248 available-for-sale securities Change in fair value of 1,119 (758) 4,845 3,447 warrant liability Interest and other expense and foreign currency gain (104) (25) (262) (22) (loss) Net loss $(8,474) $(7,168) $(31,862) $(27,454) Loss per share: Basic and $(0.22) $(0.32) $(0.93) $(1.46) diluted Weighted average number of 38,156,591 22,743,388 34,376,427 18,778,066 common shares outstanding Plug Power Inc. Reconciliation of Non-GAAP financial measures Reconciliation of Reported Net loss to EBITDAS Three months ended Twelve months ended December December 31, 31, 2012 2011 2012 2011 Operating loss, as $(9,544) $(6,412) $(36,671) $(31,127) reported Stock based 501 (150) 2,002 1,452 compensation Depreciation and 1,190 1,100 4,376 4,455 amortization EBITDAS $(7,853) $(5,462) $(30,293) $(25,220) EBITDAS is defined as operating income (loss), as adjusted for depreciation and amortization expense and charges for equity compensation.EBITDAS is a non-GAAP measure of our financial performance and should not be considered as alternatives to net income or any other performance measure derived in accordance with GAAP, or as an alternative to cash flows from operating activities as a measure of our liquidity. Reconciliation of Gross margin percentage to Adjusted gross margin percentage Three months ended Twelve months ended December December 31, 31, 2012 2011 2012 2011 Product and service $5,696 $11,296 $24,407 $23,223 revenues, as reported Deferred revenue recognized in the (1,619) (939) (3,362) (2,020) reporting period Current invoiceable value of shipments, 302 2,615 3,631 3,728 recorded to deferred revenue Product and service $4,379 $12,972 $24,676 $24,931 revenues, as adjusted Cost of product and $9,106 $11,482 $37,657 $30,670 service revenue Gross margin (59.9%) (1.6%) (54.3%) (32.1%) percentage Adjusted gross margin (107.9%) 11.5% (52.6%) (23.0%) percentage Gross margin percentage is a financial ratio used to indicate the relationship between cost of product and service revenue and product and service revenue.We use the term adjusted gross margin percentage to refer to product and service revenue, as adjusted, less total cost of product and service revenue as a percentage of product and service revenue, as adjusted.This non-GAAP financial measure allows management to view gross margin percentage as if revenue had been fully recognized upon invoicing.We believe that these non-GAAP measures, when taken together with our GAAP financial measures, allow us and our investors to better evaluate short-term and long-term profitability trends. While management believes that these non-GAAP financial measures provide useful supplemental information to investors, there are limitations associated with the use of these non-GAAP financial measures.These measures are not prepared in accordance with GAAP and may not be directly comparable to similarly titled measures of other companies due to potential differences in the exact method of calculation. Plug Power Inc. and Subsidiaries Condensed Consolidated Statements of Cash Flows (Unaudited) Twelve months ended December 31, 2012 2011 Cash Flows From Operating Activities: Net loss $(31,862) $(27,454) Adjustments to reconcile net loss to net cash used in operating activities: Depreciation 2,070 2,132 Amortization of intangible asset 2,306 2,323 Loss on disposal of property, plant and 52 309 equipment Loss on sale of leased assets 20 -- Stock-based compensation 2,002 1,452 Gain sale of leased assets -- (673) Realized loss on available-for-sale -- 22 securities Change in fair value of warrant liability (4,845) (3,447) Changes in assets and liabilities that provide (use) cash: Accounts receivable 9,368 (9,193) Inventory (1,295) 1,438 Prepaid expenses and other current assets (94) (310) Note receivable (571) -- Accounts payable, accrued expenses, product warranty reserve and other 914 (1,101) liabilities Deferred revenue 1,770 1,192 Net cash used in operating activities (20,165) (33,310) Cash Flows From Investing Activities: Purchase of property, plant and equipment (78) (1,326) Restricted cash -- 525 Proceeds from sale of leased assets -- 673 Proceeds from disposal of property, plant 64 47 and equipment Proceeds from maturities and sales of -- 10,399 available-for-sale securities Net cash (used in) provided by investing (14) 10,318 activities Cash Flows From Financing Activities: Purchase of treasury stock -- (158) Proceeds from issuance of common stock 17,192 22,584 Stock issuance costs (1,402) (1,891) Proceeds (repayment) from borrowings under (2,024) 5,405 line of credit Proceeds from long term debt 2,105 -- Principal payments on long-term debt (170) (10) Net cash provided by financing activities 15,701 25,930 Effect of exchange rate changes on cash 1 (36) (Decrease) increase in cash and cash (4,477) 2,902 equivalents Cash and cash equivalents, beginning of 13,857 10,955 period Cash and cash equivalents, end of period $9,380 $13,857 CONTACT: Media & Investor Relations Contact: Gerard L. Conway, Jr. Plug Power Inc. Phone: (518) 782-7700 firstname.lastname@example.org email@example.com Plug Power, Inc Logo
Plug Power Announces Fourth Quarter and Year-End 2012 Financial Results
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