ICP Solar Announces Fiscal 2010 Second Quarter Financial Results
Mon Sep 14, 8:16 AMMONTREAL--(BUSINESS WIRE)--ICP Solar Technologies Inc. (OTCBB: ICPR.OB, FRANKFURT: K1U.F), a developer, manufacturer and marketer of proprietary solar panels and products, today announced financial results for its second fiscal quarter ended July 31, 2009.
Highlights for the Quarter
- ICP Solar posted sales of $1.4 million for the fiscal second quarter and gross profit of $0.4 million, or 26% of sales, versus a gross margin of 17% in the prior year period even as revenues fell due to the global recession and supply chain issues.
- Shipments were negatively affected during the quarter by vendor constraints in China, where many traditional suppliers have gone out of business in the current economic environment. ICP Solar worked to quickly switch to larger, more established vendors and ship products to customers, but the transition resulted in lower revenue and a negative impact to gross margins.
- SG&A expenses declined 50% in the quarter ended July 31, 2009 versus the second quarter of fiscal 2009 and were down 14% sequentially from the fiscal 2010 first quarter.
- ICP Solar also recently announced a number of initiatives to expand its product line and accelerate growth, including new solar chargers with Konarka, a global licensing agreement with Energizer®, and an upcoming line of portable power products sold under the iSun® brand.
“While ICP Solar initiated several new product developments this quarter and made further progress towards profitability, we were disappointed with the Company’s overall financial results,” said Sass Peress, CEO. “Anticipating that the global economic slowdown would have an impact on end-user demand, we managed our inventory levels judiciously and conserved cash. However, orders were higher than expected, and we thus found it necessary to make and ship products to our distributors via air freight and other less attractive methods, negatively impacting our gross margins. Furthermore, quite a few of our suppliers in China had become unreliable in the current environment or gone out of business altogether, so ICP Solar found it necessary to switch to other vendors during the period – costing both time and money. While these factors were unanticipated, we are now better positioned with stronger suppliers and better forecasting tools to manage working capital requirements.
“During the quarter and afterwards, ICP Solar announced a number of exciting new product rollout initiatives that we believe will strengthen our industry position and bolster our growth rate going forward. Our relationship with Konarka brings cutting edge, inexpensive solar chargers utilizing their patented Power Plastic® solar cells, and the global licensing agreement with Energizer Holdings will broaden our product portfolio across a number of new markets. In addition, the upcoming launch of the Energizersolar.com and Energizersolar.eu websites will provide valuable exposure and increased awareness for ICP Solar. We expect to see products from both the Konarka and Energizer partnerships become available during the fourth quarter. Our GreenMeter® global rollout continues, and we recently also announced that our iSun® brand of portable solar chargers will soon be available for sale as well. ICP Solar is clearly laying out a strategy to rapidly grow the Company in the quarters to come.
“We remain dedicated to becoming profitable as soon as possible and believe the Company would have reached breakeven this past quarter if not for the supply chain issues encountered. We are now better prepared for the anticipated growth and see continued financial improvement as our new product introductions gain traction this year and next.”
Financial Results
Revenue for the second quarter of fiscal 2010 was $1.4 million, as compared with $1.9 million for the second quarter of fiscal 2009, reflecting global economic conditions and supply chain constraints. Gross profit was $0.4 million, or 26% of sales, versus $0.3 million, or 17% of sales, in the prior year period. The Company's operating loss for the quarter was $(0.6) million versus $(1.4) million in the second quarter of fiscal 2009, with the decrease primarily due to lower SG&A expense. The Company posted a comprehensive net loss for the second quarter of $(7.1) million, or $(0.19) per diluted share, compared with a net loss of $(3.6) million, or $(0.11) per diluted share, for the second quarter of fiscal 2009. Results for the current period include approximately $6.5 million in non-cash charges related to the Company’s warrants and convertible debentures.
Conference Call
ICP Solar will host a conference call at 10:00 a.m. Eastern on September 14, 2009 for the fiscal second quarter ended July 31, 2009. During the call, Sass Peress, CEO, will review the company’s operations and financial results. The telephone number for the conference call is 800-938-1123.
Non-GAAP Measures
The Company uses certain non-GAAP measures to assist in assessing its financial performance. Non-GAAP measures do not have any standardized meaning prescribed by GAAP and are therefore unlikely to be comparable to similar measures presented by other companies. One such non-GAAP measure used for assessing financial performance is net income (loss) before interest, income taxes, amortization, financing costs and non-cash charges ("Adjusted EBITDA").
About ICP Solar Technologies, Inc:
ICP Solar is a developer and marketer of solar panels, solar cell based products, solar monitoring software and solar power management solutions. Through the application of its own intellectual property and next-generation technologies, the Company aims to be the solar industry's innovation leader. For the past 20 years, ICP Solar has been a lead innovator in the consumer solar market and has now begun to apply that same innovation philosophy to the OEM, rooftop and power generation segment of the solar industry. ICP Solar's management has over 50 years of experience in the renewable energy sector. ICP Solar markets its products under its sunsei® brand and, in the solar charger category, is the North American licensee of the Coleman® brand as well as the global licensee of the Energizer® brand. ICP Solar is also helping the environment by offering these solar technologies and green solutions to the renewable energy sector. The company's headquarters are located in Montreal, Canada, with an R&D center in St. John’s Canada and additional locations in the USA, Ireland, France and the UK. Additional information may be found at www.icpsolar.com, www.sunsei.com, and www.sunsei.eu.
This release may contain forward-looking statements. Often, but not always, forward-looking statements can be identified by the use of words such as "expects," "plans," "estimates," "intends," "believes," "could," "might," "will" or variations of such words and phrases. Forward-looking statements involve known and unknown risks, uncertainties, and other factors which may cause the actual results, performance, or achievements of ICP Solar Technologies Inc. to be materially different from any future results, performance, or achievements expressed or implied by the forward-looking statements. These statements are based on management's current expectations and beliefs and are subject to a number of risks and uncertainties which are described under the caption "Note Regarding Forward-looking Statements" and "Key Information - Risk Factors" and elsewhere in ICP Solar Technologies Inc.’s Annual Report for the fiscal year ended January 31,2008, as filed on EDGAR at www.sec.gov. The risk factors identified in ICP Solar Technologies Inc. Annual Report are not intended to represent a complete list of factors that could affect ICP Solar Technologies Inc. Accordingly, readers should not place undue reliance on forward-looking statements. ICP Solar Technologies Inc. does not assume any obligation to update the forward-looking information contained in this press release.
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ICP Solar Technologies, Inc. |
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| For the three months | For the six months | |||||||||||||||
| ended July 31, | ended July 31, | |||||||||||||||
| 2009 | 2008 | 2009 | 2008 | |||||||||||||
| Net Sales | $ | 1,365,952 | $ | 1,946,943 | $ | 2,812,911 | $ | 3,838,597 | ||||||||
| Cost of Sales | 1,008,403 | 1,613,901 | 2,117,388 | 2,849,886 | ||||||||||||
| Gross Margin | 357,549 | 333,042 | 695,522 | 988,711 | ||||||||||||
| Expenses | ||||||||||||||||
| Selling, general and administrative | 806,834 | 1,628,344 | 1,740,535 | 3,168,326 | ||||||||||||
| Depreciation | 20,369 | 6,946 | 40,878 | 13,342 | ||||||||||||
| Research and development | 14,230 | 117,025 | 56,129 | 155,273 | ||||||||||||
| Foreign exchange loss (gain) | 101,393 | 7,759 | 138,579 | 13,745 | ||||||||||||
| Total Expenses | 942,826 | 1,760,074 | 1,976,120 | 3,350,686 | ||||||||||||
| Operating Loss | (585,277 | ) | (1,427,032 | ) | (1,280,598 | ) | (2,361,975 | ) | ||||||||
| Interest expense | (64,461 | ) | (64,308 | ) | (142,477 | ) | (101,055 | ) | ||||||||
| Interest expense on put warrants | (5,761,000 | ) | (560,667 | ) | (9,902,000 | ) | (560,667 | ) | ||||||||
| Change in fair value or derivative liability -embedded conversion option | 82,441 | - | (138,964 | ) | - | |||||||||||
| Interest income | - | 851 | 5,614 | |||||||||||||
| Forgiveness of loan receivable | - | - | (88,973 | ) | ||||||||||||
| Discount on senior secured debentures | (731,031 | ) | (246,914 | ) | (1,577,949 | ) | (246,914 | ) | ||||||||
| Accretion of discount on convertible notes | - | (137,573 | ) | (167,495 | ) | |||||||||||
| Discount on loan receivable | - | - | 166,404 | |||||||||||||
| Accretion of discount on loan receivable | - | 26,367 | 35,639 | |||||||||||||
| Financing costs | (382,761 | ) | (382,761 | ) | ||||||||||||
| Gain on disposal of subsidiary | 9 | 9 | ||||||||||||||
| Net Loss before Income Taxes | $ | (7,059,328 | ) | $ | (2,792,028 | ) | $ | (13,041,988 | ) | $ | (3,702,174 | ) | ||||
| Deferred Income Taxes | - | 850,000 | 850,000 | |||||||||||||
| Comprehensive Loss | $ | (7,059,328 | ) | $ | (3,642,028 | ) | $ | (13,041,988 | ) | $ | (4,552,174 | ) | ||||
| Basic Weighted Average Number of Shares Outstanding | 37,667,640 | 33,724,100 | 37,667,640 | 33,724,100 | ||||||||||||
| Basic and Diluted Loss Per Share | (0.19 | ) | (0.11 | ) | (0.35 | ) | (0.13 | ) | ||||||||
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ICP Solar Technologies, Inc. |
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For the Three-Month Period |
For the Six-Month Period Ended July 31, |
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| 2009 | 2008 | 2009 | 2008 | |||||||||
| Net Earnings (Loss) before Income Taxes | ($7,059,328 | ) | ($2,792,028 | ) | ($13,041,988 | ) | ($3,702,174 | ) | ||||
| Interest | 64,461 | 64,308 | 142,477 | 101,055 | ||||||||
| Interest expense on put warrant | 5,761,000 | 560,667 | 9,902,000 | 560,667 | ||||||||
| Depreciation | 20,369 | 6,946 | 40,878 | 13,342 | ||||||||
| Amotization of loan discount | - | - | - | (166,404 | ) | |||||||
| Accretion of discount on convertible notes | - | 137,573 | - | 167,495 | ||||||||
| Amortization of discount on convertible debentures | 731,031 | 246,914 | 1,577,949 | 246,914 | ||||||||
| Accretion of discount on loan receivable | - | (26,367 | ) | - | (35,639 | ) | ||||||
| EBITDA | (482,467 | ) | (1,801,987 | ) | (1,378,684 | ) | (2,814,744 | ) | ||||
| Other non-cash items: | ||||||||||||
| Forgiveness of loan receivable | - | - | - | 88,973 | ||||||||
| Foreign exchange | 101,393 | 7,759 | 138,579 | 13,745 | ||||||||
| Stock based compensation | 74,572 | 518,545 | 381,892 | 1,200,678 | ||||||||
| Change in fair value of derivative liability -embeded conversion option | (82,441 | ) | - | 138,964 | - | |||||||
| Gain on disposal of subsidiary | - | (9 | ) | - | (9 | ) | ||||||
| Adjusted EBITDA | ($388,944 | ) | ($1,275,692 | ) | ($719,250 | ) | ($1,511,357 | ) | ||||
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ICP Solar Technologies, Inc. |
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| July 31, 2009 | January 31, 2009 | |||||||
| Assets | ||||||||
| Current | ||||||||
| Cash | $ | 39,066 | $ | 193,517 | ||||
| Accounts receivable | 661,243 | 622,981 | ||||||
| Inventories | 1,004,288 | 1,492,808 | ||||||
| Prepaid expenses | 99,315 | 12,941 | ||||||
| 1,803,912 | 2,322,247 | |||||||
| Property and Equipment | 76,152 | 88,030 | ||||||
| Intangible, net of accumulated amortization of $82,200 (2008-$nil) | 91,914 | 120,914 | ||||||
| Investment in Convertible Debenture net of $967,600 provision | 1 | 1 | ||||||
| Total Assets | $ | 1,971,979 | $ | 2,531,192 | ||||
| Liabilities | ||||||||
| Current | ||||||||
| Accounts payable and accrued liabilities | 2,053,607 | 1,648,019 | ||||||
| Put option liability | 134,397 | 67,555 | ||||||
| Derivative liability-embedded conversion option | 943,186 | - | ||||||
| Government grants payable | 10,565 | 17,533 | ||||||
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Senior Secured Convertible Debentures, less unamortized discount of $ 1,130,985 (2009-$2,708,934) |
785,054 | 171,517 | ||||||
| 3,926,810 | 1,904,624 | |||||||
| Put Warrant | 13,502,000 | 3,600,000 | ||||||
| Shareholders' Deficiency | ||||||||
| Capital Stock | 413 | 351 | ||||||
| Additional Paid-In Capital | 17,520,297 | 16,157,548 | ||||||
| Accumulated Other Comprehensive Loss | (1,005,625 | ) | (1,005,625 | ) | ||||
| Accumulated Deficit | (31,971,916 | ) | (18,125,706 | ) | ||||
| Total Shareholders' Deficiency | (15,456,831 | ) | (2,973,432 | ) | ||||
| Total Liabilities & Shareholders' Deficiency | $ | 1,971,979 | $ | 2,531,192 | ||||
ICP Solar Technologies Inc.
Sass Peress, Chief Executive
Officer
514-270-5770
or
Investor Relations:
Chris
Witty, 646-438-9385
cwitty@darrowir.com
158.94 (1.43%)
