Ocean Power Technologies Announces Fiscal First Quarter Results
Ocean Power Technologies, Inc. (“OPT” or “the Company”) today announced financial results for its Fiscal 2014 first quarter ended July 31, 2013.
– The Company’s net loss for first quarter of Fiscal 2014 declined to $3.8 million from $4.4 million in the first quarter of Fiscal 2013.
-OPT also recently announced the following developments:
— Deployment of the Company’s enhanced Autonomous PowerBuoy® (“APB-350”) 35 miles off the coast of New Jersey in 140 feet of water. This project is part of the previously-announced Cooperative Research and Development Agreement (“CRADA”) with the U.S. Department of Homeland Security (“DHS”) Science & Technology Directorate. Under this program, the Company has performed in-ocean tests on its proprietary APB-350 to further validate the technology’s capacity for expanded ocean surveillance. The system deployed includes a new acoustic sonar system, in addition to the existing HF radar, to allow detection of sub-surface and surface activity. This round of systems testing has been completed, with very good data received on energy output and on the sonar system’s sub-surface detection of vessel acoustic profiles.
— Award of two grants from the U.S. Department of Energy. The first was made under the Small Business Innovation Research program as a Phase I grant for approximately $150,000. This project is for the study of advanced control technologies for optimizing OPT’s next-generation PowerBuoy. Separately, the Company won a $1.0 million award for work to optimize design of the PowerBuoy’s float and spar, subject to negotiation of the final contract. This effort will include consideration of materials used and the geometry of the systems to maximize power-to-weight output ratios and to reduce overall installed capital costs.
— Final assembly has begun in Spain by OPT and its WavePort consortium partners of a PowerBuoy that features an enhanced energy conversion system utilizing a new wave prediction model. Significant progress continues, including land testing. The buoy features an advanced modular power take-off.
“We are very excited to have received two awards from the U.S. Department of Energy, and appreciate this new opportunity to be part of their initiatives in support of the marine hydrokinetic industry,” said Charles F. Dunleavy, Chief Executive Officer of OPT. “In addition, I am happy to report that we have received positive feedback to the news of this deployment and the expanded mission capability of the APB-350 from several market sectors which we are pursuing. Under this Department of Homeland Security program, we are pleased with the initial results of our APB-350 in terms of power generation and the performance of our new on-board ocean surveillance sonar system. We expect to conduct further tests of the system going forward, building on these initial results and after we implement some planned improvements to the APB-350. At the same time, we are continuing to develop other potential projects in the U.S. and overseas, and we anticipate further progress in the current fiscal year towards commercialization in both our utility and autonomous PowerBuoy end markets.”
OPT’s contract backlog as of July 31, 2013 was $3.5 million, compared to $3.8 million as of April 30, 2013 and $5.8 million as of July 31, 2012. We anticipate that the majority of our backlog will be recognized as revenues over a period exceeding 12 months. Approximately $1.2 million of our July 31, 2013 backlog is for our Oregon project; the realization of that backlog depends on resolution of regulatory matters and our decision to seek additional funding to enable completion of this project. Backlog includes funded amounts and unfunded amounts that are expected to be funded in the future. The current backlog is fully funded. The Company’s contract backlog consists largely of cost-sharing contracts to support product development.
Results for the Fiscal First Quarter Ended July 31, 2013
For the three months ended July 31, 2013, OPT reported revenue of $0.5 million as compared to revenue of $1.0 million for the three months ended July 31, 2012. This decrease relates primarily to a lower level of external funding for the Company’s Mark 4 PowerBuoy development project and a decline in revenue tied to OPT’s prospective PowerBuoy deployment off Reedsport, Oregon, which has been delayed pending resolution of regulatory, financial and other matters. OPT also completed the current phase of the Company’s project with Mitsui Engineering & Shipbuilding in the prior fiscal year.
The net loss for the three months ended July 31, 2013 was $3.8 million as compared to a net loss of $4.4 million for the three months ended July 31, 2012. The favorable decrease in the Company’s net loss year-over-year reflects lower product development costs, with the decline primarily due to a lower level of activity for OPT’s project in Oregon.
Cash and Investments
On July 31, 2013 total cash, cash equivalents, restricted cash and investments were $18.6 million, as compared to $21.7 million as of April 30, 2013. Net cash used in operating activities was $3.1 million and $3.4 million for the three months ended July 31, 2013 and 2012, respectively. Net cash used was lower in the Fiscal 2014 first quarter relative to the corresponding prior year period due to lower expenses related to the Company’s Oregon project.
Press Release, September 13, 2013