Maxwell Technologies Reports Second Quarter Financial Results CONFERENCE CALL & WEBCAST AT 5 P.M. (EDT) TODAY - DETAILS BELOW PR Newswire SAN DIEGO, July 31, 2014 SAN DIEGO, July 31, 2014 /PRNewswire/ --Maxwell Technologies, Inc. (Nasdaq: MXWL) today reported revenue of $46.1 million for its second quarter ended June30, 2014, up slightly from the $46.0 million recorded in the first quarter ended March31, 2014, but down 17 percent from the $55.6 million recorded in the second quarter of 2013. Enabling Energy's Future. Second quarter ultracapacitor revenue increased by 6 percent sequentially to $33.9 million, compared with $32.0 million in the first quarter ended March31, 2014, but was down 14 percent compared with the $39.3 million recorded in the second quarter of 2013. Sales of high voltage capacitor and microelectronics products totaled $12.2 million in Q214, down 13 percent sequentially from the $14.0 million recorded in the first quarter and down 26 percent from the $16.4 million recorded in Q213. "This was a solid quarter in line with our expectations despite lower ultracapacitor sales into the hybrid bus market in China and challenging market conditions for our microelectronics products," said Dr. Franz Fink, Maxwell's president and CEO. "Increasing sales for wind energy and electric rail applications were mainly responsible for the sequential growth in ultracapacitor sales." On a U.S. generally accepted accounting principles (GAAP) basis, operating loss for the second quarter 2014 was $567,000, compared with operating income of $760,000 in Q114 and $4.2 million in Q213. GAAP net loss for Q214 was $1.2 million, or $0.04 per share, compared with net income of $319,000, or $0.01 per diluted share in Q114 and $3.4 million, or $0.12 per diluted share, in Q213. On a non-GAAP basis, the Company reported operating income of $599,000 in Q214 compared with $1.5 million in Q114 and $5.2 million in Q213. Non-GAAP net loss for Q214 was $15,000, or zero cents per share, compared with net income of $1.1 million, or $0.04 per diluted share in Q114 and $4.4 million, or $0.15 per diluted share, in Q213. A reconciliation of GAAP to non-GAAP financial measures is included as an addendum to this release. GAAP gross margin was 36 percent in Q214, compared with 39 percent in both Q114 and Q213. GAAP operating expenses totaled approximately $17.2 million, or 37 percent of revenue, in Q214 compared with $17.1 million, or 37 percent of revenue, in Q114, and $17.4 million, or 31 percent of revenue, in Q213. Non-GAAP operating expenses totaled approximately $16.2 million, or 35 percent of revenue, in Q214 compared with $16.6 million, or 36 percent of revenue, in Q114 and $16.7 million, or 30 percent of revenue, in Q213. Cash and cash equivalents totaled $30.7 million as of June30, 2014, compared with cash, cash equivalents and restricted cash of $32.6 million as of March31, 2014. 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: Limited visibility into the plug-in hybrid bus market in China makes it difficult to forecast ultracapacitor sales with a high degree of certainty. Based on customer forecasts for bus and other ultracapacitor applications and order flow for microelectronics and high voltage capacitor products, total revenue for the third quarter is likely to be down as much as 15% compared with that recorded in the second 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 second 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) 952-1906 from the U.S. and Canada, or (785) 424-1825 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: http://investors.maxwell.com/phoenix.zhtml?c=94560&p=irol-calendar. 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 www.maxwell.com. 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 future; 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 proceedings. 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: investors.maxwell.com. All information in this release is as of July31, 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; email@example.com MAXWELL TECHNOLOGIES, INC. CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS (in thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, June 30, 2014 2014 2013 2014 2013 Revenue $ 46,074 $ 46,001 $ 55,610 $ 92,075 $ 103,358 Cost of revenue 29,474 28,131 34,034 57,605 63,552 Gross profit 16,600 17,870 21,576 34,470 39,806 Operating expenses: Selling, general and 10,944 10,939 11,988 21,883 23,490 administrative Research and 6,223 6,171 5,378 12,394 11,401 development Total operating 17,167 17,110 17,366 34,277 34,891 expenses Income (loss) from (567) 760 4,210 193 4,915 operations Interest expense, 28 39 41 67 85 net Amortization of debt discount and prepaid 5 5 15 10 30 debt costs Income (loss) before (600) 716 4,154 116 4,800 income taxes Income tax provision 581 397 749 978 1,673 Net income (loss) $ (1,181) $ 319 $ 3,405 $ (862) $ 3,127 Net income (loss) per common share: Basic $ (0.04) $ 0.01 $ 0.12 $ (0.03) $ 0.11 Diluted $ (0.04) $ 0.01 $ 0.12 $ (0.03) $ 0.11 Weighted average common shares outstanding: Basic 29,206 29,047 28,858 29,127 28,842 Diluted 29,206 29,216 28,860 29,127 28,859 MAXWELL TECHNOLOGIES, INC. CONDENSED CONSOLIDATED BALANCE SHEETS (in thousands, except per share data) (Unaudited) June 30, December 31, 2014 2013 ASSETS Current assets: Cash and cash equivalents $ 30,748 $ 30,647 Trade and other accounts receivable, net 39,850 29,869 Inventories 44,973 44,736 Prepaid expenses and other current assets 3,170 2,314 Total current assets 118,741 107,566 Property and equipment, net 42,192 44,941 Intangible assets, net 268 369 Goodwill 26,140 25,978 Pension asset 11,139 10,568 Other non-current assets 665 665 Total assets $ 199,145 $ 190,087 LIABILITIES AND STOCKHOLDERS' EQUITY Current liabilities: Accounts payable and accrued liabilities $ 26,643 $ 25,436 Accrued warranty 583 180 Accrued employee compensation 8,935 8,788 Deferred revenue and customer deposits 3,181 1,043 Short-term borrowings and current portion of 10,106 7,914 long-term debt Deferred tax liability 874 890 Total current liabilities 50,322 44,251 Deferred tax liability, long-term 2,155 2,125 Long-term debt, excluding current portion 65 100 Other long-term liabilities 3,513 3,401 Total liabilities 56,055 49,877 Stockholders' equity: Common stock, $0.10 par value per share, 40,000 shares authorized; 29,897 and 29,563 shares issued 2,987 2,953 and outstanding at June 30, 2014 and December31, 2013, respectively Additional paid-in capital 274,946 271,928 Accumulated deficit (152,656) (151,794) Accumulated other comprehensive income 17,813 17,123 Total stockholders' equity 143,090 140,210 Total liabilities and stockholders' equity $ 199,145 $ 190,087 MAXWELL TECHNOLOGIES, INC. RECONCILIATION OF GAAP TO NON-GAAP FINANCIAL MEASURES (in thousands, except per share data) (Unaudited) Three Months Ended Six Months Ended June 30, March 31, June 30, June 30, June 30, 2014 2014 2013 2014 2013 Gross Profit Reconciliation: GAAP gross profit $ 16,600 $ 17,870 $ 21,576 $ 34,470 $ 39,806 Stock-based compensation expense A 190 251 261 442 534 included in cost of sales Non-GAAP gross $ 16,790 $ 18,121 $ 21,837 $ 34,912 $ 40,340 profit Total Operating Expenses Reconciliation: GAAP total operating $ 17,167 $ 17,110 $ 17,366 $ 34,277 $ 34,891 expenses Stock-based A (976) (504) (685) (1,479) (1,369) compensation expense Non-GAAP total $ 16,191 $ 16,606 $ 16,681 $ 32,798 $ 33,522 operating expenses Income (Loss) From Operations Reconciliation: GAAP income (loss) $ (567) $ 760 $ 4,210 $ 193 $ 4,915 from operations Stock-based A 1,166 755 946 1,921 1,903 compensation expense Non-GAAP income from $ 599 $ 1,515 $ 5,156 $ 2,114 $ 6,818 operations Net Income (Loss) Reconciliation: GAAP net income $ (1,181) $ 319 $ 3,405 $ (862) $ 3,127 (loss) Stock-based A 1,166 755 946 1,921 1,903 compensation expense Non-GAAP net income $ (15) $ 1,074 $ 4,351 $ 1,059 $ 5,030 (loss) Net Income (Loss) per Diluted Share Reconciliation: GAAP net income (loss) per diluted $ (0.04) $ 0.01 $ 0.12 $ (0.03) $ 0.11 share Stock-based A 0.04 0.03 0.03 0.07 0.06 compensation expense Non-GAAP net income (loss) per diluted $ — $ 0.04 $ 0.15 $ 0.04 $ 0.17 share MAXWELL TECHNOLOGIES, INC. 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 Six Months Ended June 30, March June 30, June June 2014 31, 2013 30, 30, 2014 2014 2013 Cost of revenue $ 190 $ 251 $ 261 $ 442 $ 534 Selling, general and 733 255 507 988 1,004 administrative Research and 243 249 178 491 365 development Total stock-based $ 1,166 $ 755 $ 946 $ 1,921 $ 1,903 compensation expense Logo - http://photos.prnewswire.com/prnh/20121018/LA91771LOGO SOURCE Maxwell Technologies, Inc. Website: http://www.maxwell.com
Maxwell Technologies Reports Second Quarter Financial Results
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