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American Superconductor Corporation (AMSC) has reported the first quarterly profits in company history for Q4 FY2008. AMSC reported net income of $1.3 million for the quarter, compared with a net loss for Q4 FY2007 of $1.8 million. The company also reported increased year-on-year revenues. The company’s net loss for FY2008 was $16.6 million, which compares with a net loss for FY2007 of $25.4 million. AMSC share prices fell 9.7%, from $25.71 to $23.21, on the day of the announcement.
Superconducting Businesses see Revenue Drop
The move to profitability was driven by AMSC’s non-superconductor businesses. Of the $61.2 million in revenues reported by AMSC in Q4 FY2008, only $3 million were attributed to superconductor-related business. That figure represented a decrease from $4 million in superconductor-related revenues in Q4 FY2007. AMSC’s power systems division saw revenues rise from $34.3 million in Q4 FY2007 to $58.2 million in Q4 FY2008.
Jason Fredette, AMSC’s Director of Investor and Media Relations, stated that the decline in superconducting sales was linked to the completion of projects: “We recognized revenue from our Navy motor and LIPA contracts in Q4 FY2007. Those projects have since been completed.”
“We don’t provide sales forecasts for our business units, but we do expect to increase our total revenue from approximately $183 million in FY2008 to a range of $225 million to $235 million in FY2009.”
Workforce, Revenues Grow
“AMSC posted its strongest financial performance to date in Q4 FY2008,” said Greg Yurek, AMSC’s founder and CEO. “We generated record revenues and achieved our first profitable quarter. During FY2008, we expanded our global workforce by 36% as we increased our revenue by 63% while also developing and introducing several new wind power and power grid solutions.
“We self-financed these activities, which resulted in a small net use of cash for the fiscal year. We are now sharply focused on delivering profitable growth and net cash flow positive results for FY2009 as we continue to make the investments that will enhance our long-term growth prospects.”
David Henry, senior VP and CFO, stated that the company expected increased revenues for FY 2009: “We are increasing our gross margin target for FY2009, and we expect this will enable us to generate net income in a range of $0.2 million to $1.5 million for FY2009.”