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Superconductor Technologies Inc. Announces Third Quarter 2005 Results
Santa Barbara, CA, Nov. 2: Superconductor Technologies Inc.
(NASDAQ:SCON)
(STI), a leading provider of high performance infrastructure products for wireless voice and data applications, today announced results for the quarter and nine months ended October 1, 2005.
Total net revenues for the third quarter were $3.9 million, a decrease of 46 percent, compared to $7.3 million for the year ago third quarter. Net commercial product revenues for the third quarter of 2005 decreased 50 percent to $3.1 million, compared to $6.1 million in the third quarter of 2004. Government and other contract revenue totaled $865,000 during the 2005 third quarter, compared to $1.2 million during the third quarter of 2004.
As of October 1, 2005, STI had commercial product backlog of $950,000, compared to $333,000 at the end of the second quarter of 2005 and $380,000 at the end of the year-ago third quarter, with remaining minimum purchase commitments totaling $1.5 million from one customer under a general purchase agreement. As of October 1, 2005, STI had $18.8 million in working capital, including $14.9 million in cash and cash equivalents. During the third quarter, STI received net proceeds of $11.5 million from the sale of common stock and warrants in a public offering.
"Our third quarter financial results illustrate revenue variability that can occur with a highly concentrated customer base, and although we are disappointed with the sales volume for the period, we were successful in executing our plan to diversify and grow our customer footprint," stated Jeff Quiram, STI's president and chief executive officer. "We signed an extension of an existing general purchase agreement with a major wireless operator that expanded our exposure within its network. Our initiative to develop custom solutions quickly in response to our customers' pressing network quality challenges is being successfully implemented. In fact, we have recently received orders for new products developed during the third quarter. These new solutions are also gaining acceptance by a second national wireless operator and we believe we will repeat this success with additional customers. While several unusual events including a customer merger and disruptions caused by weather negatively impacted our third quarter revenue performance, I am pleased with our overall progress."
Quiram continued, "We managed operating expenses effectively in the third quarter and our organization is more efficient than last year at this time. We are making progress developing a strong foundation from which to continue broadening our custom solutions and product line, improving sales coverage, and diversifying our customer base. We look forward to announcing continued progress as our growth strategy bears fruit."
Net loss for the third quarter was $3.6 million, compared to a net loss of $5.2 million in the third quarter of 2004. This improvement is due to the continued focus on streamlining operations. Net loss per diluted share was $0.03, compared to a net loss of $0.06 per diluted share in the same quarter of 2004.
For the first nine months of 2005, total net revenues were $16.8 million, compared to $19.1 million for the first nine months of 2004. Net commercial product revenues for the first nine months of 2005 were $14.4 million, compared to $13.8 million in the year ago period. The company recorded $2.4 million in government and other contract revenues for the first nine months of 2005, compared to $5.2 million for the first nine months of 2004. The net loss for the first nine months of 2005 was $11.2 million, compared to $19.9 million for the prior year's first nine months, which included restructuring expenses of $2.7 million, a non cash interest charge of $802,000 for warrants issued in connection with a bridge loan, and ISCO related litigation expenses of $438,000. The net loss for the first nine months of 2005 was $0.10 per diluted share, compared to $0.25 per diluted share in the first nine months of 2004.
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