Maxwell Technologies Reports First Quarter Financial Results

         Maxwell Technologies Reports First Quarter Financial Results

Appoints Dr. Franz Fink President And CEO


PR Newswire

SAN DIEGO, May 1, 2014

SAN DIEGO, May 1, 2014 /PRNewswire/ --Maxwell Technologies, Inc. (Nasdaq:
MXWL) today reported revenue of $46.0 million for its first quarter ended
March31, 2014, down 4 percent from the $47.7 million recorded in the same
period in 2013. In a separate news release issued today, the company announced
the appointment of Dr. Franz Fink as president and chief executive officer.

Enabling Energy's Future.

Ultracapacitor revenue decreased by 5 percent, to $32.0 million in Q114,
compared with $33.8 million in the same period last year. Sales of high
voltage capacitor and microelectronics products totaled $14.0 million in both
Q114 and Q113.

On a U.S. generally accepted accounting principles (GAAP) basis, operating
income for the first quarter 2014 was $760,000, compared with $705,000 in
Q113. GAAP net income for Q114 was $319,000, or $0.01 per share, compared with
a net loss of $278,000, or $0.01 per share, in Q113.

On a non-GAAP basis, the Company reported operating income of $1.5 million in
Q114 compared with $1.7 million in Q113. Non-GAAP net income for Q114 was $1.1
million, or $0.04 per diluted share compared with $679,000, or $0.02 per
diluted share, in Q113. A reconciliation of GAAP to non-GAAP financial
measures is included as an addendum to this release.

GAAP gross margin was 39 percent in Q114, compared with 38 percent in Q113 and
37 percent in Q413. GAAP operating expenses totaled approximately $17.1
million, or 37 percent of revenue, in Q114 compared with $17.5 million, or 37
percent of revenue in Q113. Non-GAAP operating expenses totaled approximately
$16.6 million, or 36 percent of revenue, in Q114 compared with $16.8 million,
or 35 percent of revenue, in Q113. Cash, cash equivalents and restricted cash
totaled $32.6 million as of March31, 2014, compared with cash and cash
equivalents of $30.6 million as of December31, 2013. 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.

Outlook: "While the plug-in hybrid bus market gains momentum in China, our
visibility into this demand remains limited. However, the growth in our other
ultracapacitor markets remains robust," said John Warwick, Maxwell's chief
operating officer."Based on customer forecasts across our product lines, we
expect total revenue for the second quarter to be similar to that reported for
the first quarter."

Non-GAAP Financial Measures: The Company uses non-GAAP financial measures for
internal evaluation and to report the results of its business. These non-GAAP
financial measures include non-GAAP gross profit, non-GAAP operating expenses,
non-GAAP income (loss) from operations, non-GAAP net income (loss), and
non-GAAP net income (loss) per diluted share. These measures are not in
accordance with, nor an alternative to, GAAP. These measures are intended to
supplement GAAP financial information, and may be computed differently from
non-GAAP financial measures used by other companies. The Company believes that
these measures provide useful information to its management, board of
directors and investors about its operating activities and business trends
related to its financial condition and results of operations. The Company
believes that it is useful to provide investors with information to understand
how specific line items in the statement of operations are affected by certain
non-cash or non-recurring items, such as stock-based compensation expense.

In addition, the Company's management and board of directors use these
non-GAAP financial measures in developing operating budgets and in reviewing
the Company's results of operations, as non-cash and non-recurring items have
limited impact on current and future operating decisions. Additionally, the
Company believes that inclusion of non-GAAP financial measures provide
consistency and comparability with its past reports of financial results.
However, investors should be aware that non-GAAP measures have inherent
limitations and should be read in conjunction with the Company's consolidated
financial statements prepared in accordance with GAAP. Please refer to the
accompanying tables for a detailed reconciliation of GAAP to non-GAAP gross
profit, operating expenses, income from operations, net income, and net income
per share.

Management will conduct a conference call and simultaneous webcast to discuss
first quarter of 2014 financial results and the future outlook at 5 p.m. (EDT)
today. The call may be accessed by dialing toll-free, (866) 952-1908 from the
U.S. and Canada, or (785) 424-1827 for international callers, and entering the
conference ID, MAXWELL. The live webcast and subsequent archived replay may be
accessed at the Company's web site via the following link:

Maxwell is a global leader in the development and manufacture of innovative,
cost-effective energy storage and power delivery solutions. Our ultracapacitor
products provide safe and reliable power solutions for applications in
consumer and industrial electronics, transportation, renewable energy and
information technology. Our CONDIS® 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-hardened
microelectronic products for satellites and spacecraft include single board
computers and components incorporating our proprietary RADPAK® packaging and
shielding technology that enables them to perform reliably in space. For more
information, visit

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. Such risks, uncertainties and
contingencies include, but are not limited to, the following:

  oour ability to remain competitive and stimulate customer demand through
    successful introduction of new products, and to educate our prospective
    customers on the products we offer;
  odependence upon the sale of products to a small number of customers and
    vertical markets, some of which are heavily dependent on government
    funding or government subsidies which may or may not continue in the
  odependence upon the sale of products into Asia and Europe, where
    macroeconomic factors outside our control may adversely affect our sales;
  orisks related to our international operations including, but not limited
    to, our ability to adequately comply with the changing rules and
    regulations in countries where our business is conducted, our ability to
    oversee and control our foreign subsidiaries and their operations, our
    ability to effectively manage foreign currency exchange rate fluctuations
    arising from our international operations, and our ability to continue to
    comply with the U.S. Foreign Corrupt Practices Act as well as the
    anti-bribery laws of foreign jurisdictions and the terms and conditions of
    our settlement agreements with the Securities and Exchange Commission and
    the Department of Justice;
  osuccessful acquisition, development and retention of key personnel;
  oour ability to effectively manage our reliance upon certain suppliers of
    key component parts, specialty equipment and logistical services;
  oour ability to match production volume to actual customer demand;
  oour ability to manage product quality problems;
  oour ability to protect our intellectual property rights and to defend
    claims against us;
  oour ability to effectively identify, enter into, manage and benefit from
    strategic alliances;
  ooccurrence of a catastrophic event at any of our facilities;
  ooccurrence of a technology systems failure, network disruption, or breach
    in data security;
  oour ability to obtain sufficient capital to meet our operating or other
    needs; and,
  oour ability to manage and minimize the impact of unfavorable legal

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 these documents may be
obtained by contacting Maxwell's investor relations department at (858)
503-3434, or at our investor relations website: All
information in this release is as of May1, 2014. The Company undertakes no
duty to update any forward-looking statement to reflect actual results or
changes in the Company's expectations.

Media & Investor Contact: Michael Sund +1 (858) 503-3233;

(in thousands, except per share data)
                                                Three Months Ended
                                                March 31, 2014  March 31, 2013
Revenue                                         $   46,001      $   47,748
Cost of revenue                                 28,131          29,518
Gross profit                                    17,870          18,230
Operating expenses:
Selling, general and administrative             10,939          11,502
Research and development                        6,171           6,023
Total operating expenses                        17,110          17,525
Income from operations                          760             705
Interest expense, net                           39              44
Amortization of debt discount and prepaid debt  5               15
Income before income taxes                      716             646
Income tax provision                            397             924
Net income (loss)                               $   319         $   (278)
Net income (loss) per common share:
Basic                                           $   0.01        $   (0.01)
Diluted                                         $   0.01        $   (0.01)
Weighted average common shares outstanding:
Basic                                           29,047          28,825
Diluted                                         29,216          28,825

(in thousands, except per share data)
                                             March 31, 2014  December 31, 2013
Current assets:
Cash and cash equivalents                    $   31,585      $    30,647
Restricted cash                              1,000           —
Trade and other accounts receivable, net     37,628          29,869
Inventories                                  45,003          44,736
Prepaid expenses and other current assets    2,336           2,314
 Total current assets                       117,552         107,566
Property and equipment, net                  43,746          44,941
Intangible assets, net                       318             369
Goodwill                                     26,201          25,978
Pension asset                                10,919          10,568
Other non-current assets                     666             665
 Total assets                               $   199,402     $    190,087
Current liabilities:
Accounts payable and accrued liabilities     $   27,433      $    25,436
Accrued warranty                             512             180
Accrued employee compensation                8,598           8,788
Deferred revenue and customer deposits       2,729           1,043
Short-term borrowings and current portion    10,540          7,914
of long-term debt
Deferred tax liability                       876             890
 Total current liabilities                  50,688          44,251
Deferred tax liability, long-term            2,153           2,125
Long-term debt, excluding current portion    83              100
Other long-term liabilities                  3,686           3,401
 Total liabilities                          56,610          49,877
Stockholders' equity:
Common stock, $0.10 par value per share,
40,000 shares authorized; 29,930 and 29,563  2,990           2,953
shares issued and outstanding at March 31,
2014 and December31, 2013, respectively
Additional paid-in capital                   273,276         271,928
Accumulated deficit                          (151,475)       (151,794)
Accumulated other comprehensive income       18,001          17,123
 Total stockholders' equity                 142,792         140,210
 Total liabilities and stockholders'        $   199,402     $    190,087

(in thousands, except per share data)
                             Three Months Ended
                             March 31, 2014  December 31, 2013  March 31, 2013
Gross Profit
GAAP gross profit            $   17,870      $    14,374        $   18,230
Stock-based compensation
expense included in cost   A 251             316                273
of sales
Non-GAAP gross profit        $   18,121      $    14,690        $   18,503
Total Operating Expenses
GAAP total operating         $   17,110      $    16,941        $   17,525
Stock-based compensation   A (504)           (1,042)            (684)
Non-GAAP total operating     $   16,606      $    15,899        $   16,841
Income (Loss) From
Operations Reconciliation:
GAAP income (loss) from      $   760         $    (2,567)       $   705
Stock-based compensation   A 755             1,358              957
Non-GAAP income (loss)       $   1,515       $    (1,209)       $   1,662
from operations
Net Income (Loss)
GAAP net income (loss)       $   319         $    (2,814)       $   (278)
Stock-based compensation   A 755             1,358              957
Non-GAAP net income (loss)   $   1,074       $    (1,456)       $   679
Diluted Net Income (Loss)
per Share Reconciliation:
GAAP diluted net income      $   0.01        $    (0.10)        $   (0.01)
(loss) per share
Stock-based compensation   A 0.03            0.05               0.03
Non-GAAP diluted net         $   0.04        $    (0.05)        $   0.02
income (loss) per share


    Stock-based compensation expense consists of non-cash charges for employee
(A) stock options, restricted stock awards, restricted stock units and
    employee stock purchase plan awards. Results include stock-based
    compensation expense as follows (in thousands):
                            Three Months Ended
                            March 31, 2014      December 31,      March 31,
                                                2013              2013
    Cost of revenue         $     251           $    316          $   273
    Selling, general and    255                 804               497
    Research and            249                 238               187
    Total stock-based       $     755           $    1,358        $   957
    compensation expense

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SOURCE Maxwell Technologies, Inc.

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